France, Italy expected to announce deal on French shipyard

PARIS (AP) — The French and Italian governments are expected to announce Wednesday a deal allowing Italian shipbuilder Fincantieri to take control of a key French shipyard, ending a weeks-long disagreement between the countries. France had this summer blocked the takeover of the shipyard STX, on...

PARIS (AP) — The French and Italian governments are expected to announce Wednesday a deal allowing Italian shipbuilder Fincantieri to take control of a key French shipyard, ending a weeks-long disagreement between the countries.

France had this summer blocked the takeover of the shipyard STX, on the Atlantic coast, citing concerns about jobs but angering the Italian government. The sides then said they hoped to reach a deal to combine forces in shipbuilding to create a European champion.

French Finance minister Bruno Le Maire told reporters Wednesday he hopes a deal would create "a global shipbuilding giant." Italian Defense minister Roberta Pinotti said in comments released by her office that "there are all indications that Italy and France can work together. Both on civil and military shipbuilding".

The announcement is expected later Wednesday when French President Macron meets Italian counterpart Paolo Gentiloni in the French city of Lyon.

Le Monde newspaper reports, without identifying sources, that both governments agreed on a deal giving state-controlled Fincantieri a 51 percent stake in the shipyard.

Fincantieri would formally own a 50 percent stake and the French state would lend it a further 1 percent stake so that the Italian group would hold operational control, according to Le Monde. This mechanism would allow France to take control back if needed.

The remaining stake would be in the French hands, mostly the government and the state-owned Naval Group.

Fincantieri shares were up 1.8 percent in late morning trading on expectations of the deal.

In July, the French government temporarily nationalized the STX shipyard to prevent Fincantieri from taking it over and to give itself time to negotiate more guarantees.

At the time, the French government had argued it needed to defend its strategic and military interests, guarantee thousands of jobs, and ensure that French know-how is not transferred outside Europe.

The shipyard, located in Saint-Nazaire, last year turned out the world's largest cruise ship, the Harmony of the Seas, as well as the Queen Mary II.

The French-Italian deal would come just one day after the high-profile merger between Germany's Siemens and France's Alstom to create a European train-making giant.

In a sweeping speech on Europe on Tuesday, Macron called on reinforcing European industry to make it "competitive at the world level".

___

Nicole Winfield in Rome contributed to the story.

More in Home