{"id":53749,"date":"2018-02-01T02:11:37","date_gmt":"2018-02-01T02:11:37","guid":{"rendered":"https:\/\/one.sightlinemg.com\/defensenews\/uncategorized\/2018\/02\/01\/italy-france-naval-integration-faces-election-hitch\/"},"modified":"2026-08-07T23:50:56","modified_gmt":"2026-08-07T23:50:56","slug":"italy-france-naval-integration-faces-election-hitch","status":"publish","type":"post","link":"https:\/\/one.sightlinemg.com\/defensenews\/global\/europe\/2018\/02\/01\/italy-france-naval-integration-faces-election-hitch\/","title":{"rendered":"Italy, France naval integration faces election hitch"},"content":{"rendered":"\n

Ministers from France and Italy meet in Rome on Thursday to discuss their planned naval business integration<\/a> with one cloud on the horizon \u2014 Italy\u2019s fast approaching March election.<\/p>\n\n\n\n

Planners from both countries are working on how best to merge Fincantieri and Naval Group<\/a> \u2014 Italy and France\u2019s state ship yards \u2014 which is being seen as a crucial step towards fuzing Europe\u2019s fractured defense industry.<\/p>\n\n\n\n

Following the formation of a working group last September, the two sides have committed to producing a blueprint by May.<\/p>\n\n\n\n

On Thursday, Fincantieri CEO Giuseppe Bono and the head of Naval Group, Herv\u00e9 Guillou, are expected to give a progress report on talks to a Italy\u2019s defense, industry and treasury ministers, Roberta Pinotti, Carlo Calenda and Pier Carlo Padoan, respectively. Alongside them will be French Armed Forces Minister Florence Parly and Finance and Economy Minister Bruno Le Maire.<\/p>\n\n\n\n

Also present will be Italy and France\u2019s defense procurement chiefs, Carlo Magrassi and Jo\u00ebl Barre, who are both members of the working group, alongside the two CEOs.<\/p>\n\n\n\n

Bono and Guillou are likely to get the blessings of the ministers to push on towards closer integration, which could initially see a share swap between the firms, followed by an eventual full merger.<\/p>\n\n\n\n

\u201cIt\u2019s good news,\u201d said Eva Pejsova, senior analyst at the Paris office of European Institute for Security Studies. \u201cThere is a lot of competing tension between EU member states, particularly in Asia. On the strategic level, the more consolidation there is in research and development and cooperation in deals, the better it is for European leverage at the global defense market,\u201d she added.<\/p>\n\n\n\n

The hitch is that the three Italian ministers present at Thursday\u2019s meeting may be out of a job on March 4 when Italy holds a general election, leaving a large question mark over how talks will proceed.<\/p>\n\n\n\n

Italy\u2019s ruling Democratic Party is lagging in the polls, and may be supplanted on March 4 by a right wing coalition of three parties backed by former prime minister Silvio Berlusconi.<\/p>\n\n\n\n

One analyst who declined to be named said that if a new government is announced, it would not take office until the end of March, leaving the outgoing government to take care of final business during March.<\/p>\n\n\n\n

\u201cFor that reason, the naval working group may want to produce its blueprint before the ministers step down at the end of March,\u201d he said.<\/p>\n\n\n\n

Analysts suggest that even if Berlusconi wins the election, his coalition may not have enough seat in parliament to form a government, leading to drawn out talks on building a broader coalition. If that is the case, the outgoing ministers may find themselves staying in office beyond the end of March, giving them more time to sign off on the naval integration blueprint.<\/p>\n\n\n\n

But even if they do, the final signature may still be needed from the new government. Italy\u2019s \u2018Golden Power\u2019 law requires the government cabinet sign off on all changes in governance at strategic industries \u2014 which would be the case if Fincantieri integrates operations with Naval Group. \u201cMinisters may want to leave that sign-off to the next government,\u201d said the analyst.<\/p>\n\n\n\n

The thorny question still to be resolved in the talks is the role to be played by Italian defense group Leonardo, which supplies systems and armaments for the naval vessels built by Fincantieri.<\/p>\n\n\n\t