Shipbuilder STX France's future hangs in the balance

By Euronews

Published on 03/01/2017 - 19:09

Italian shipyard Fincantieri has been approved as the preferred bidder for cruise-ship builder STX France, but politics could yet scupper the deal.

Cruise ship builder STX France has moved a step closer to being bought by the Italian shipyard Fincantieri.

The company – which is based in Saint-Nazaire – is being sold by its bankrupt South Korean owner STX. On Tuesday a court in Seoul approved Fincantieri as the preferred bidder.

The French operation is the only profitable part of the STX group. It is best known for building the world’s largest passenger ship – the ‘Harmony of the Seas’ – and has orders for 14 cruise vessels which will keep it busy through until 2026.

Cruise-ship market dominance

Fincantieri, which makes a wide range of vessels including military aircraft carriers, is looking to bolster its leadership position in the cruise ship-building market.

It currently operates 20 shipyards on four continents and has between 40 and 45 percent of the cruise market; purchasing STX France would lift its share to around 60 percent.

However the deal is complicated by the fact that the French government owns 33 percent of STX France and could block the sale.

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.

Free floating anxiety

The sale is also in danger of becoming a political football in the run-up to this year’s French presidential election, with concerns over layoffs and some politicians calling for the company to be nationalised.

The French Industry Minister Christophe Sirugue is due to go to Saint-Nazaire to meet unions representing the company’s 2,600 workers on Wednesday, according to the French Finance Minister Michel Sapin.