BERLIN (AP) - German industrial group ThyssenKrupp said Monday it plans to take over the country's biggest shipbuilder, HDW, and merge it with its own shipbuilding operation.
HDW, short for Howaldtswerke-Deutsche Werft, is a leading manufacturer of non-nuclear military submarines, and also builds ferries, large yachts and specialist vessels.
It was acquired in 2002 by One Equity Partners, an investment firm backed by Chicago-based Bank One Corporation.
ThyssenKrupp said the two companies signed a declaration of intent Sunday that would see OEP receive 25 percent of the shares in the merged shipyard group and 240 million (US$285 million) in cash in exchange for 100 percent of Kiel-based HDW's shares.
The new shipyard group, which will be managed by ThyssenKrupp Werften GmbH, will have about 9,300 staff and a sales volume of some 2.2 billion (US$2.6 billion), ThyssenKrupp said in a statement.
"Both partners agree that major synergies can be realized through the merger,'' the statement said. Details are still being finalized, it said, adding that "the concentration of development, sales and production activities is expected to yield major benefits.''
The deal, which "represents a first step toward greater consolidation of European naval shipbuilding,'' should be completed in the fall of 2004, ThyssenKrupp said.
ThyssenKrupp shares were down 2.7 percent at 12.68 (US$15.08) in morning trading on the Frankfurt exchange.
The DAX index of blue-chip stocks was down 2.1 percent overall.
HDW has bought rivals in Sweden and Greece in a bid to create a shipbuilding giant able to compete for big orders around the world.
But the company has chalked up losses from civilian shipbuilding, complaining that yards in the Far East have forced down prices. - AP