France will buy a 33.34 percent stake in the Chantiers de l'Atlantique yard for 110 million euros ($141 million) in a move aimed at securing a strategic naval shipbuilding capacity in state hands, the office of President Nicolas Sarkozy said in a Nov. 6 statement.
Chantiers de l'Atlantique, which has the only facility big enough to build a large aircraft carrier, is owned by the Korean STX Shipbuilding group.
The stake size is larger than the nine percent the government said it would buy when it made its surprise announcement in June of a plan to purchase shares in Chantiers de l'Atlantique.
Under the deal, the French government will pay 110 million euros in a capital increase which will dilute the current owners STX Europe to 50.01 percent from 75 percent and Alstom to 16.65 percent from 25, the statement said. The state may pay up to a further 85 million euros in 2012 depending on company performance.
"This acquisition by the state reflects the strategic nature of Chantiers de l'Atlantique and translates the will to put in place a long term industrial partnership between the STX group and the French state," the statement said. "Chantiers de l'Atlantique possesses a unique quality in naval engineering and a unique industrial capability in Europe which should be nurtured."
The stake purchase gives an immediate cash injection which strengthens the company's finances and allows it to develop, the statement said. With the one-third holding, the state holds a blocking minority stake and has right of veto on major corporate decisions. STX has also agreed to refrain from developing industrial capacity outside Europe which competes with the core activities of Chantiers de l'Atlantique, the statement said.
France intends to create a sovereign wealth fund and will transfer the stake to the new entity when it is in place.
France has postponed to 2011-12 a decision on whether to build a sister ship to the nuclear-powered carrier Charles de Gaulle. If the new capital ship gets the green light, Chantiers de l'Atlantique would likely build the hull, while naval systems company DCNS would handle the superstructure and systems integration.
Sarkozy has indicated he would welcome a merger of DCNS and Chantiers de l'Atlantique, which is a commercial shipbuilder.
Naval executives from Navantia of Spain and ThyssenKrupp Marine Systems of Germany said at the recent Euronaval trade show that defense and civil shipbuilding were distinct activities with few overlaps in design or purchasing given the nature of military specifications.
Chantiers de l'Atlantique, which has the only facility big enough to build a large aircraft carrier, is owned by the Korean STX Shipbuilding group.
The stake size is larger than the nine percent the government said it would buy when it made its surprise announcement in June of a plan to purchase shares in Chantiers de l'Atlantique.
Under the deal, the French government will pay 110 million euros in a capital increase which will dilute the current owners STX Europe to 50.01 percent from 75 percent and Alstom to 16.65 percent from 25, the statement said. The state may pay up to a further 85 million euros in 2012 depending on company performance.
"This acquisition by the state reflects the strategic nature of Chantiers de l'Atlantique and translates the will to put in place a long term industrial partnership between the STX group and the French state," the statement said. "Chantiers de l'Atlantique possesses a unique quality in naval engineering and a unique industrial capability in Europe which should be nurtured."
The stake purchase gives an immediate cash injection which strengthens the company's finances and allows it to develop, the statement said. With the one-third holding, the state holds a blocking minority stake and has right of veto on major corporate decisions. STX has also agreed to refrain from developing industrial capacity outside Europe which competes with the core activities of Chantiers de l'Atlantique, the statement said.
France intends to create a sovereign wealth fund and will transfer the stake to the new entity when it is in place.
France has postponed to 2011-12 a decision on whether to build a sister ship to the nuclear-powered carrier Charles de Gaulle. If the new capital ship gets the green light, Chantiers de l'Atlantique would likely build the hull, while naval systems company DCNS would handle the superstructure and systems integration.
Sarkozy has indicated he would welcome a merger of DCNS and Chantiers de l'Atlantique, which is a commercial shipbuilder.
Naval executives from Navantia of Spain and ThyssenKrupp Marine Systems of Germany said at the recent Euronaval trade show that defense and civil shipbuilding were distinct activities with few overlaps in design or purchasing given the nature of military specifications.