(Alliance News) - Leonardo Spa is reportedly preparing a bid to create Iveco Defence Vehicles, a made-in-Italy hub for military vehicles, by evaluating the acquisition of Iveco Group NV's asset.

According to a report in Corriere della Sera on Thursday, Leonardo has called some international investment banks, including UBS, to study the purchase of Iveco Defence Vehicles, an Iveco Group company that produces armored vehicles, tanks and other combat vehicles. The business has more than 1,800 employees and ended 2023 with EUR1 billion in revenues and a 7.7 percent margin.

According to the Corriere, the two companies know each other well because IDV "has a historic industrial partnership with Oto Melara, Leonardo's subsidiary specializing in guns. Iveco Defence Vehicles would increase Leonardo's production capacity, also with a view to strengthening European alliances."

Leonardo CEO Roberto Cingolani has, after all, repeatedly stressed the need for consolidation in the continental defense market, now divided into too many national platforms that end up dispersing investment.

According to insiders' estimates, Iveco's asset is worth around EUR750 million although, in the aftermath of the first rumors of Leonardo's interest, analysts had imagined a higher valuation in light of the multiples of other companies in the sector.

Leonardo, after selling shares on Nasdaq for more than EUR300 million in its DRS subsidiary, is also about to receive up to EUR415 million from the sale of Wass torpedoes to Fincantieri Spa.

Leonardo's stock is down 0.6 percent to EUR23.65 per share while Iveco Group's stock gains 5.7 percent to EUR11.88 per share.

https://www.corriere.it/economia/aziende/24_giugno_06/veicoli-militari-polo-made-in-italy-leonardo-prepara-l-offerta-a-iveco-4cfc0a31-1f08-4764-bb96-716d825a5xlk.shtml

By Giuseppe Fabio Ciccomascolo, Alliance News senior reporter

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