IPO timing is right

Italian state shipbuilder Fincantieri will be listed by the summer as it seeks a cash injection vital to its future.

The long-awaited listing in Milan will boost its finances by EUR 600m ($833m) through a sale of new shares, its top two executives told TradeWinds.

Chief financial officer (CFO) Fabrizio Palermo explained that the group has built up a big orderbook of around EUR 8bn, particularly in the cruiseship sector, but has to fund 80% of the construction costs itself before delivery.

He and CEO Giuseppe Bono are currently on a roadshow, drumming up interest from investors, and feedback has been good.

“Fincantieri is one of a kind,” Bono said, pointing to its mix of cruiseship, mega-yacht, offshore and naval business at 21 yards across four continents.

He added: “We need capital from the market to let the company grow according to the rules of the market, which will bring value to all shareholders.”

Asked why the long-delayed part-privatisation was happening now to Fincantieri ahead of other state-owned groups, Palermo said: “We had done our homework and we were the most ready of all the candidates.

“We have waited a long time to find the right moment.”

He explained that the state will retain a 50.1% stake, but will sell stock up to 49.9% of the enlarged capital, which includes the EUR 600m in new shares.

The pair would not be drawn on how much the state’s eventual share disposal could be worth, saying the market would decide.

The government’s finance arm Cassa Depositi e Prestiti (CDP) will bank the proceeds from this part of the deal.

And Palermo revealed the sale has been structured so that no new investor could own a slice bigger than 5%.

As for future acquisitions, he said: “We are always looking for opportunities.”

Bono summed up its takeover philosophy by saying:  “We try to anticipate the market’s development. We did so successfully in the past and we hope to do so in the future, because we believe that the world’s future is at sea."

Brazil, the UAE and India were all mooted as potential areas for growth in terms of new orders.

Palermo would not comment on talk of a new cruiseship order for MSC, but said he hoped to have good news on a number of fronts in the coming months.

Fincantieri is virtually wholly owned (99.3%) by the Italian state-owned financier that controls parent company Fintecna.