Shandong Heavy Industry Group have announced that it has reached agreements to buy the world’s largest luxury yacht maker, the Italian company Ferretti Group.
Through a total investment of 374 million euros including equity investment of 178 million euros and provision of debt financing of 196 million euros, SHIG-Weichai Group will acquire a 75% interest in the yacht maker after the completion of the debt restructuring procedures. Existing creditors will acquire the remaining 25% interest in Ferretti through a 25 million euros equity injection and debt to equity swap. Through the acquisition Ferretti’s capital will be fully restructured with equity capital increase by 100 million euros and total debts reduce to a reasonable level at around 120 million euros. The business will enjoy a strong capital base which will help drive its long-term development plans.
Mr. Tan Xuguang, Chairman of SHIG—Weichai Group, said:
Developing the yacht business is one of the Group’s strategic goals for the next five years. Ferretti, which possesses iconic international brands, state-of-the-art manufacturing technologies, products of the highest quality and an extensive sales network, is an ideal partner. Through the acquisition, the Group will cooperate closely with this world-renowned yacht maker, providing Ferretti with new channels to market and capital support as well as other resources with which it can expand more effectively into emerging markets, a key area of potential growth for Ferretti. Synergies between the Group and Ferretti can be unleashed through the sharing of resources and industrial integration. Ferretti’s overall competitive advantages in production cost, sales channels, after-sales service and financial strength will be improved, creating a win-win situation that will allow Ferretti to consolidate its leading position in the luxury yacht market
Ferretti is the world’s largest luxury yacht manufacturer and boasts one of the world’s most advanced naval research and development centres and a team of architects and designers. It also has a comprehensive global supply chain, which includes more than 800 suppliers, as well as some of the world’s most advanced yacht manufacturing systems. Ferretti has eight highly regarded and recognised yacht brands and owns a total of 8 shipyards in Italy as well as in Miami, USA, and employs nearly 2,000 employees.
SHIG—Weichai Group is one of the most competitive equipment manufacturing groups in China offering a broad range of commercial vehicles, construction machinery and other heavy-duty industrial products. The Group operates four main divisions, namely commercial vehicles, construction machinery, power generation systems and auto parts. In addition to its market foundation in China, the Group has also been active in the overseas markets. In 2009 they acquired Moteurs Baudouin SA in France through its subsidiary Weichai Power Co., Ltd, which has helped the Group expand into the international high-end yacht business. After the acquisition Weichai Power invested an accumulated 30 million euros and implemented multiple measures to improve Baudouin’s businesses and operations.
SHIG-Weichai aims to facilitate Ferretti‘s expansion in emerging markets such as Asia, with a particular focus on Greater China which will be an important growth engine for Ferretti’s future development. In addition the Group will provide a range of other resources including capital support to Ferretti to stimulate its rapid business development in both the traditional European and American markets as well as other emerging markets. After the acquisition, the Group will continue to uphold its operational principle of “unifying strategies and resources while operating independently” and will retain Ferretti’s key management team, headquarters and production bases in Italy.
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