ITALY: On February 24 the Hitachi and Finmeccanica boards announced the signing of binding agreements for the Japanese group to buy Napoli-based rolling stock manufacturer AnsaldoBreda and Finmeccanica’s 40% stake in Genova-based signalling, train control and turnkey transport system supplier Ansaldo STS.
Hitachi Rail said the acquisitions would represent a ‘key milestone’ in its strategy to become ‘a global leader in total rail solutions’, significantly expanding its international footprint, offering a unique opportunity to pursue untapped growth potential in new markets, and strengthening its position in signalling, traffic management and turnkey operations.
The transactions are expected to close later this year, subject to regulatory approval. Hitachi will pay €773m for Ansaldo STS (€9·65 per share), subject to a possible pre-closing downward adjustment in the event that Ansaldo STS approves any distribution of dividends. In accordance with Italian law, Hitachi will then launch a tender offer for all remaining Ansaldo STS shares.
The total net consideration to be paid to Finmeccanica for the current business of AnsaldoBreda and the real estate assets amounts to €36m. Some of AnsaldoBreda’s refurbishment activities and residual contracts are excluded from the deal.
As a result of the transactions Finmeccanica’s net debt at the end of 2015 will reduce by €600m, with a net total capital gain of €250m. The company said Hitachi had been selected as ‘the best industrial partner to ensure a successful long-term repositioning’ of its transport activities. ‘The sale of the rail transport business is a key step in the execution of our Industrial Plan, aimed at focusing and strengthening the group in the core business – hi-tech Aerospace, Defence & Security’, said CEO & General Manager Mauro Moretti. ‘Hitachi has clearly recognised the know-how and expertise which would be contributed by both AnsaldoBreda and Ansaldo STS within the new group and I am sure both companies will play a key role in the future development of the Hitachi Rail business worldwide, with their centres of excellence in Transportation Systems and Mass Transit.’
Finmeccanica was assisted by Mediobanca and UBS as financial advisers and by Grimaldi Studio Legale as legal adviser. The independent directors were assisted by Equita Sim as financial adviser. Hitachi Group was assisted by Citi as financial adviser and Gianni, Origoni, Grippo, Cappelli & Partners as legal adviser.