Fincantieri to Take Over STX Shipyard as France, Italy End Dispute

  • Our Bureau
  • 12:43 PM, September 28, 2017
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Fincantieri to Take Over STX Shipyard as France, Italy End Dispute
STX Shipyard, France

Italian shipbuilder Fincantieri will take control of France's STX shipyard to create one of the largest naval shipbuilding companies in the world.

The Italian and French governments struck a deal in Lyon yesterday to end a dispute between the two countries after France had unexpectedly blocked a takeover of the STX shipyard by Fincantieri this summer, citing job and strategic concerns, AFP reported.

The agreement was announced one day after the high-profile merger between Germany's Siemens and France's Alstom to create a European train-making giant.

Macron, speaking alongside Italian Premier Paolo Gentiloni in the French city of Lyon, called the French-Italian shipyard agreement a "win-win deal" aimed at "creating a world champion in the naval field."

Putting the industrial dispute between the two countries behind him, Gentiloni said, "Italy and France have a great need for a Europe that is a motor of investment, work, and growth," he said.

STX is the only shipyard in France big enough to build aircraft carriers and large warships. Last year, it turned out the world's largest cruise ship, the Harmony of the Seas, and earlier created the Queen Mary II.

The deal effectively gives state-controlled Fincantieri a 51 percent stake in the key shipyard, which is located on the Atlantic coast in Saint-Nazaire.

Fincantieri will pay 60 million euros ($70.5 million) to own 50 percent of STX, Macron's office said. France will lend Fincantieri another 1 percent stake to give the Italian group operational control.

The lending mechanism allows France to take back the 1 percent stake during the next 12 years, if the French government determines Fincantieri is not complying with its commitments.

The remaining 49 percent stake will remain in French hands, held mostly by the government and the state-owned Naval Group.

Under the new shareholder structure, 34.34 percent will be owned by the French state, including the 1 percent stake loaned to Fincantieri.

Fincantieri has committed to maintaining the shipyard's research and development division in France; to not transferring know-how or intellectual property outside Europe; to granting France a right of veto over the future name of the STX company; and to giving the French special rights related to the military activity of STX.

In July, the French government temporarily nationalized the shipyard to prevent Fincantieri from taking it over and to give itself time to negotiate more guarantees. At the time, the French government had argued it needed to defend its strategic and military interests, guarantee thousands of jobs, and ensure that French know-how was not transferred outside Europe.