Austal USA has invested an undisclosed amount into a qualified equity fund that has acquired the Alabama Shipyard in Mobile. The investment was supported by the award of a US$152 million (~$220 million) contract by the US Navy which aims to uplift the production of modules for US Virginia and Columbia class submarines.
“This contract from the US Navy to expand production capacity further strengthens the role Austal has cemented in the US submarine industrial base,” said Austal CEO Paddy Gregg.
With the investment, Austal USA has become a limited partner in the United Submarine Alliance Qualified Opportunity Fund (USA Fund). The USA Fund bought out the Alabama Shipyard's assets, facilities and land, however, the shipyard itself will continue to operate as a tenant on the site. The Alabama Shipyard currently takes up around 25 per cent of the 355 acres acquired by the USA Fund.
The remaining 75 per cent of the land will be redeveloped by the USA Fund to support submarine module production and workforce training. The US requires an additional 3.5 to 4.5 million submarine module production and outfitting hours annually to support the Virginia and Columbia class programs.
"This announcement answers my call for investment into small-to-medium size shipyards, both active and dormant, that were previously the backbone of our Nation’s maritime power, and I look forward to continuing to work with industry on future initiatives to strengthen our maritime industrial base," said the US Secretary of the Navy Carlos Del Toro.