Civmec to Acquire Luerssen Australia Consolidating Defense Shipbuilding
In a move designed to consolidate Australia’s defense shipbuilding industry and build sovereign capabilities, construction and engineering services company Civmec has reached terms to buy Luerssen Australia. Civmec had announced its intention to acquire the shipbuilder last October as a key move to strengthen its position in a competition for a new contract from the Australian government.
Civmec said the acquisition represents a pivotal step in its long-term strategy to strengthen its position as a sovereign Australian shipbuilder. Civmec, which has operations in Western Australia and has been working with Luerssen on offshore patrol vessels, reports it will pay A$20 million (US$13 million) and expects to complete the acquisition by July 1.
“This Acquisition enhances Civmec’s ability to deliver end-to-end naval shipbuilding solutions, from design through to commissioning, and unlocks opportunities to drive production efficiencies, accelerate delivery schedules, and secure future shipbuilding contracts. It also fast-tracks the development of Civmec’s sovereign shipbuilding capabilities,” the company said explaining the strategic rationale for the acquisition.
Luerssen Australia was launched eight years ago as a subsidiary of NVL (Naval Vessels Lürssen) of Germany to pursue the SEA 1180 contract, a program to build offshore patrol boats. NVL was selected as the preferred prime contractor and designer for the SEA 1180 Offshore Patrol Vessel program. The first two were built by BAE Systems, and four additional vessels were built by Civmec in a partnership with Luerssen Australia.
The focus on Luerssen Australia was expanded with the company reporting it specializes in the design, manufacture and servicing of yachts, naval, and coastguard vessels.
The Australian government has announced that its next major project will be the development of a new generation general purpose frigate to replace aging vessels. It is planning to order 11 vessels with the plan calling for the three lead vessels to be built internationally and eight additional vessels to be built in Western Australia.
The competition for the designer and lead for the project is reported to be between Japan’s Mogami and Germany’s Meko 200, but each would partner with a Western Australia company. The plan calls for three vessels to be built immediately in Western Australia and the five additional vessels to be built also in Western Australia with a revised design based on experience with the first ships.
Civmec says that by combining with Luerssen Australia, it will expand its experienced workforce, systems, and technical know-how. The group, which is viewed as a leading contender for the construction of the eight frigates, says that with the increased scale, its defense operations will be able to deliver five vessels over the next 3.5 years.