Fincantieri-STX operation: diplomacy at work

Genoa - The Seoul court has confirmed that the only offer that has been made for the acquisition of 66.6% of STX France (a company belonging to the Korean STX Shipbuilding & Offshore Group, which is in liquidation) came from Fincantieri, and that it will be considered by the judges next week.

Fincantieri made no comment, but at the same time in recent months there were several meetings, as Il Secolo XIX-the MediTelegraph’s sources explained, between Fincantieri C.E.O. Giuseppe Bono, STX France C.E.O. Laurent Castaing and Undersecretary for Industry Christophe Sirigue.

The goal of the meetings seems to have been to reassure the French company’s management and French politicians about Fincantieri’s intentions, confirming its willingness to work on a consolidation of the European shipbuilding industry, including a collaboration with the publicly owned company DCNS (with whom Fincantieri has already developed the Mistral and FREMM programs) as Paris indicated. Among other things, DCNS is the owner of the remaining 33.4% of the Saint Nazaire shipyard and has veto rights over the entire operation.

Kepler Cheuvreux analysts believe that the acquisition of STX France would increase Fincantieri’s revenue by 25%, and that the positive impact on EBITDA and profit would be 20% and 17%, respectively. But the plan could cause the debt/EBITDA ration to increase in 2017 from 1.8 to 3.4 times “further limiting the group’s financial flexibility.” Banca IMI is expecting an offer price under €100 million. For the moment, the order portfolio is keeping the risk of labour disputes low.