STX Europe and the French Republic have agreed that the French state becomes a 33.34 percent shareholder in STX France and its shipyards in Saint-Nazaire and Lorient. The combined ownership will expand strategic opportunities for the large capacity shipyards.
STX Europe is one of the world’s leading cruise and ferry builders, with a market share of 35 to 40 percent. The company builds cruise ships at its yards in France and Finland. The French yards also have experience with navy vessels. Other shipyards in STX Europe are market leaders for specialised offshore vessels.
EUR 110 Million Investment
The new agreement is a realization of the memorandum of understanding announced by the two parties at 12 June. The French Republic acquires the 33.34 percent interest in STX France via an equity investment of EUR 110 million which is expected to be made in November.
The French state’s initial payment will be supplemented, based on STX France’s performance over the period 2009-2011, by an earn out mechanism whereby the French state will make a direct payment of up to 83,3 million to STX Europe. If the parties decide to increase the capitalization of STX France, this amount can be reinvested in STX France and supplemented by the French state, so that STX France will receive a total amount of up to EUR 125 million. The total equity injection would then be EUR 235 million, with an implied value of STX France of EUR 470 million.
Based on the new ownership model, STX France aims to expand business in its primary market of cruise ships and ferries as well as in navy and offshore vessels.
Facts regarding the transaction
– Today, STX Europe ASA controls 75 percent of the shares in the two French yards through STX France Cruise SA. In the transaction, STX Europe and the French Republic have agreed that the French Republic becomes a shareholder in STX France Cruise SA.
– STX Europe will continue to be the controlling shareholder with just above 50 percent, while the French Republic will own approximately 33.34 percent. Alstom Holdings SA, a 25 percent shareholder of STX France, will own the remaining shares, approximately 16 percent.
– According to the agreement, the French Republic shall be represented in the Board of Directors of STX France by at least two members. STX and the French Republic have furthermore agreed a Shareholders Agreement for STX France which gives the French Republic significant minority protection, as well providing procedures and restrictions on the sale by a party of its shares in STX France.
– STX’ business within the building of cruise ships and ferries is primarily based on the shipyards in France and Finland. This strategy will continue with the new agreement.
– The agreement depends on approval of STX Europe’s Board of Directors, final approval by the French government, and approval by certain business partners of STX France.
