CIVMEC to acquire Luerssen Australia Pty Ltd. 23/10/2024 | Gabriele Molinelli

The Austro-Singaporean firm CIVMEC Ltd and the german company Naval Vessels Lüerssen of Bremen have entered an agreement, not yet binding, that details the transfer of ownerships of the australian branch of Lüerssen to CIVMEC in what would be yet another round of consolidation and contraction in the field of shipbuilding.

CIVMEC is a multi-multidisciplinary construction and engineering services provider to the Energy, Resources, Infrastructure, Marine and Defence sectors. It specializes in infrastructure, modularisation and heavy engineering. In 2016 it had already acquired Forgacs, which had the time was the largest privately owned shipbuilding company in Australia and had been widely involved in the construction of the HOBART class destroyers for the Royal Australian Navy, but without emerging from that program in a solid position.

The Government will have to give consent for the deal to proceed but the parties have already started talks and the companies hope to complete the deal by 31 December 2024.

Luerssen Australia Pty Ltd is currently delivering the SEA 1180 project for the RAN which was originally intended to see the building of 12 Offshore Patrol Vessels of the ARAFURA class. An interim period will have to be arranged to ensure the project is completed before the takeover fully takes place. CIVMEC will acquire “all assets, employees and licenses”. CIVMEC is already involved in the ARAFURA project, providing steel and block fabrication as a sub-contractor since 2018. Its role in the project ended earlier this year. The OPV project has been a very tormented one.

According to the contract, Luerssen Australia was awarded on 31 January 2018, the first OPV should have been delivered to the RAN in late 2021, but that milestone was missed by several years. The OPV was only launched on 16 December 2021 and only commenced contractor sea trials last august. The second vessel was launched on 22 November 2023 and boats 3 to 5 were laid down in Henderson respectively in September 2020, July 2021 and September 2022.

First steel for OPV 6 was cut in August 2022. The recent review of the Surface Fleet has seen the ARAFURA project halved, so ship 6 is now also the last OPV in the program. CIVMEC, which continues to include shipbuilding among its capabilities, assures it will be able to redeploy qualified workforce to complete the project with a smooth and successful transition.

The exit of Lüerssen from the scene underlines the sour way in which the ARAFURA project developed. While CIVMEC presents itself as “a sovereign Australian shipbuilder with world-class shipbuilding facilities”, the actual impact on shipbuilding of military interest is unlikely to be particularly positive, with the company’s focus being on either sectors and work types.

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