Italian Fincantieri Acquires 50.75 Pct Stake in STX OSV

Italian Fincantieri Acquires 50.75 Pct Stake in STX OSV

Fincantieri has signed an agreement for the acquisition from STX Europe of 50.75% of STX OSV, a company listed on the Singapore Stock Exchange and world leader in the construction of offshore support vessels for oil and gas extraction and production.

With 21 shipyards in 3 different continents, nearly 20,000 employees and revenues of Euro 4 billion, the Group is doubling its size. Fincantieri becomes one of the top five shipbuilders worldwide and the leading Western producer, also in terms of diversification and presence in the high value added segments, and is capable of competing with the Asian giants. Compared with the other four top producers, all of which are Korean, the Fincantieri Group boasts a leadership position in all the maritime high-tech sectors, and is enriching its product portfolio with this entry into the offshore oil & gas market.

The terms of the agreement have been approved by the Boards of Directors of Fincantieri and STX Europe.

Under the transaction Fincantieri will buy, through its wholly owned subsidiary Fincantieri Oil & Gas S.p.A., 50.75% of STX OSV at a price of SGD 1.22 per share, totalling approximately Euro 455 million (approximately SGD 730 million). The offer price represents a discount of 12.9% to the closing price on 20 December, equal to SGD 1.40 per share, and of 17.5% to the weighted average price of the past three months, equal to SGD 1.48 per share.

The closing of the acquisition will take place within the first four months of 2013 after the conditions precedent have been satisfied. Once these conditions precedent are satisfied, Fincantieri Oil & Gas S.p.A. will launch a mandatory cash offer for the remaining shares, in compliance with the rules of the Singapore Code on Take-overs and Mergers.

The total value of the transaction, including both the acquisition of the 50.75% stake and the mandatory cash offer, will amount to approximately Euro 900 million (approximately SGD 1,450 million). It will be financed mainly from Fincantieri’s internal resources and with a syndicate loan provided by a pool of banks (Banca IMI, BNP Paribas – Italian branch, Carige, Unicredit) and by Cassa Depositi e Prestiti as a lender guaranteed by SACE.

STX OSV has approximately 9,200 employees and 10 shipyards around the world (5 in Norway, 2 in Romania, 1 in Vietnam and 2 in Brazil, of which one currently under construction). In the past three years it has generated average revenues of approximately Euro 1.6 billion and EBITDA of approximately Euro 190 million. At the end of the 2012 third quarter its order backlog was Euro 2.1 billion.

This acquisition marks Fincantieri’s entry into a market segment complementary to its current ones. The development of synergies with Fincantieri’s existing businesses will allow an increase in production volumes, that will be beneficial not only for employment levels across the Group but also for Italy’s entire production system.

“Today marks the beginning of a new era for Fincantieri,” said Giuseppe Bono, CEO of Fincantieri. “In fact, the acquisition of STX OSV will further enhance our position as a leading international competitor. This will strengthen Fincantieri’s commitment to pursuing a strategy of diversification and development in order to retain our long-term competitiveness and generate important positive impacts for our Italian assets.” Bono concluded: “I’m sure this is the right way forward to optimize our global leadership position in the high value-added end of the shipbuilding industry and to establish ourselves as champions of the Western world. This transaction is a source of pride for all Fincantieri’s employees and business partners.”

Press Release, December 21, 2012