Fincantieri Is Mulling Financial Options Including Capital Increase, Sources Say

(Bloomberg) -- Fincantieri SpA, one of Europe’s largest shipbuilders, is considering options to offset the blow dealt to its finances by the pandemic, people familiar with the matter said.

Potential actions being studied include a capital increase of as much as 1.5 billion euros ($1.8 billion) that could be approved early next year, said the people, asking not to be named because the project isn’t public.

“The company is evaluating several options for extraordinary transactions, as it routinely does. No decision has been taken yet,” a spokesman said.

Fincantieri shares have declined about 33% since the start of the year, and if the capital increase goes ahead it would be larger than the entire market capitalization of the company, which is just above 1 billion euros.

Shares fell as much as 8.9%, the most since March 27, in Milan trading after Bloomberg reported that the company is reviewing options.

Fincantieri said in November that production volumes fell 19% compared to previous estimates which did not take into account the Covid-19 impact. Net debt nearly doubled to 1.43 billion euros compared to 2019.

Italy’s state-backed lender Cassa Depositi e Prestiti SpA holds a 71% stake in the company, while the rest of the shares are held by private investors. The shipyard is headquartered in the northern city of Trieste.

In recent months, the company has been working to finalize a merger with French shipyard Chantiers de l’Atlantique but the process has been delayed to give European Union regulators time to rule on the transaction, according to a person familiar with the matter.

Last January, it created a joint venture with Naval Group to cooperate in the military sector, called Naviris.

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