Italian shipbuilder Fincantieri has signed an agreement to acquire a 50.75% stake of STX OSV, a specialist in the construction of offshore vessels for oil and gas extraction and production, for $1.2bn.
Fincantieri will buy the stake through its subsidiary Fincantieri Oil & Gas from STX Europe, a unit of South Korea-based STX.
Under the terms of the agreement, Fincantieri will pay $598.9m and, after the completion of the purchase of the stake by the end of April 2013, the company will launch a mandatory offer to acquire the remaining stake in STX OSV.
Fincantieri will fund the acquisition through its internal resources and with a syndicate loan provided by banks including Banca IMI, the Italian branch of BNP Paribas, Carige, Unicredit and by Cassa Depositi e Prestiti.
STX OSV currently operates ten shipyards including five in Norway, two in Romania, one in Vietnam and two in Brazil out of which one shipyard is under construction.
The company generated revenue of €1.6bn in the last three years and had an order backlog of €2.1bn by the end of Q3 in 2012.
Fincantieri said the acquisition will complement its existing products and help the company achieve synergies with its existing businesses to increase ship building volume.
The company currently has 21 shipyards with revenues of €4bn and the acquisition will double its size, the company said.
The company also added that the acquisition will help Fincantieri diversify and expand its presence in high value products and complete against Asian shipbuilding giants like Hyundai Heavy Industries and Samsung Heavy Industries.
Fincantieri CEO Giuseppe Bono said the acquisition of STX OSV will strengthen the company’s strategy of diversification and development to help it retain long-term competitiveness and generate positive impacts to Italian assets.
"I’m sure this is the right way forward to optimise our global leadership position in the high value-added end of the shipbuilding industry and to establish ourselves as champions of the Western world," Bono said.