South Korea Approves Fincantieri’s Bid for STX France
By Joyce Lee and Emmanuel Jarry
SEOUL/PARIS, Jan 3 (Reuters) – A South Korean court approved Italy’s Fincantieri on Tuesday as the preferred bidder to buy shipbuilder STX France, helping Fincantieri move closer to a deal that could boost its position in the cruise ship-building market.
The Seoul court spokesman, who announced the decision, declined to give further details, as did a Fincantieri spokesman. Analysts at Banca IMI estimate Fincantieri would offer below 100 million euros ($104 million) for the asset.
The sale of STX France, which specialises in building cruise ships at the Saint-Nazaire shipyard and is profitable, forms part of the broader sale of businesses from the demise of the South Korean STX shipbuilding group.
The French state intends to keep a 33 percent stake in STX France, and French Industry Minister Christophe Sirugue will meet Saint-Nazaire shipyard unions on Wednesday, said French Finance Minister Michel Sapin.
Italy’s 230-year old Fincantieri makes a wide range of vessels from cruise ships to military aircraft carriers, and the former state-owned company had 2015 sales of 4.2 billion euros.
Shares in Fincantieri were up 3.1 percent at 0.50 euros in mid-session trading.
“The deal would definitively strengthen Fincantieri’s leadership position in the cruise segment and in the medium-long term we believe it could also enhance the group’s fundamentals,” Banca IMI analysts wrote in a research note last week.
Kepler Cheuvreux also said acquiring STX France would raise Fincantieri’s share of the cruise shipbuilding segment to some 60 percent from 40-45 percent.
STX France last year delivered the largest passenger ship ever built, the ‘Harmony of the Seas’.
The holiday cruise industry has recently shown some signs of resilience to headwinds such as the Zika virus scare, that deterred travellers, and currency volatility, with Royal Caribbean Cruises in October expressing confidence about meeting its 2017 profit forecast.
France has previously said it wants state-controlled military shipbuilder DCNS, in which Thales holds around 35 percent, to take a minority stake in STX France.
“We have strategic interests that we want to keep,” said a DCNS spokesman, commenting on the STX France sale process.
($1 = 0.9630 euros) (Additional reporting by Eliza Anzolin in Milan; Writing by Sudip Kar-Gupta in Paris; Editing by Alexandra Hudson and Adrian Croft)
(c) Copyright Thomson Reuters 2017.
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