French shipbuilders Naval Group has joined forces with Italy’s Fincantieri to create a European giant (LOIC VENANCE)

Paris (AFP) – French shipbuilders Naval Group and Italy’s Fincantieri on Friday signed an agreement on Friday to create an 50-50 joint venture in a bid to take on rising global competition.

“This is the culmination of a shared industrial ambition, which is the long-term position of the European shipbuilding industrial market which has undergone a profound transformation,” Naval Group chief Herve Guillou told two journalists, including AFP.

First floated in 2017, the “Poseidon” alliance project initially included cross-shareholding between the two groups, but this was abandoned last year in favour of a joint venture.

The deal was signed on Friday by Guillou and Fincantieri chief Giuseppe Bono on board the frigate Frederico Martinengo in the Italian port city of La Spezia.

“We are by far the two largest European naval players, but if we rely on our domestic markets alone we cannot maintain our resources and remain competitive,” said Guillou.

The groups have said the alliance would permit the two companies to team up on research, development and procurement for some common projects, either bilateral or for export.

Competition in the industry is heating up, with China’s CSIC last year becoming the world’s largest shipbuilding company, while a Russian group is expected to be the second biggest next year.

Disclaimer: Validity of the above story is for 7 Days from original date of publishing. Source: AFP.