Australian engineering company, CIVMEC, is to acquire shipbuilder Luerssen Australia from Naval Vessels Luerssen (NVL) for A$20 million.
The move, which was foreshadowed last year, is a significant step in consolidating shipbuilding capabilities in the west ahead of a government decision on which new general purpose frigate (GPF) is to be acquired.
In February last year, the government announced a program to acquire 11 GPFs for the Royal Australian Navy (RAN), with contenders now down to two, the Japanese Mogami or the German Meko 200. Under the plan, first three vessels will be constructed overseas and the next three at a shipyard in Henderson, Western Australia.
The final five will also be built in WA but incorporating design modifications based on experience with the earlier vessels and including new technologies. The first of the new ships will enter service by 2030, replacing the Navy’s ageing Anzac frigates.
CIVMEC, which is listed on the Australian and Singapore stock exchanges and started out in the resources sector, is the likely builder of the eight vessels to be constructed in Australia. German shipbuilder Luerssen’s offshore patrol vessel (OPV) was chosen as replacement for the Navy’s fleet of patrol boats.
Initially 12 of these Arafura-class vessels were to be built but the government cancelled the program after six. Two were built at the BAE Systems yard in Adelaide and four by CIVMEC in Western Australia.
Under the deal announced today, CIVMEC will take ownership of the whole Luerssen Australia business, including assets, employees and licences. The deal will be funded by the group’s existing cash reserves.
CIVMEC said the aim of the deal was to solidify Australia’s sovereign shipbuilding capability by consolidating design, construction and operational expertise under a single, locally owned entity, in a bid to enhance national resilience and support long-term defence industry growth.
Luerssen Australia is a subsidiary of NVL, which is an independent, privately owned group of German shipyards and related companies.
Luerssen specialises in the design, manufacture and servicing of yachts, naval and coastguard vessels, supporting Australia’s national sovereign shipbuilding strategy and operating from the Australian Marine Complex in Henderson, Western Australia.
The acquisition has a target completion date of July 1.