German frigates set sail… towards the Emirates
(BRUXELLES2) This did not really give rise to much discussion or controversy. The European Commission authorized, on Tuesday, without firing a shot, the takeover by the Abu Dhabi MAR (ADM) group of several activities of the German industrialist TKMS in the fields of construction and repair of civilian AND military ships. This authorization thus allows the group of emirates to take a more than solid footing in a strategic activity: the production of warships.
An Arab-German rapprochement
This rapprochement has, in fact, two aspects. One is strictly civilian: ADM acquires the activities of TKMS in the field of civilian ships, such as the Blohm+Voss shipyard in Hamburg and the Howaldtswerke-Deutsche Werft in Kiel (1). The group of emirates thus becomes a major European player in shipbuilding. The other is typically military: ADM and TKMS create a joint venture in the field of jointly controlled (50/50) military surface ships. Market sharing will take place, with the German maintaining leadership for all the projects of the Bundesmarine and NATO partners, while the Arab will take charge of the Middle East/North Africa region (2). Only exception: the operation does not include (for the moment), the submarine activity of TKMS.
A choice endorsed without discussion by Brussels
This rapprochement responds to the choice of the German government, which preferred to favor the (praiseworthy) interest of employment in local shipyards over a possible European "adventure", such as the EADS naval project cherished in its time and taken up by Hervé Morin .
For the Commission, which did not open an in-depth investigation and contented itself with the usual 2-month investigation, there is no problem. "The proposed concentration does not pose any competition concerns. It does not lead to any significant overlap, the only, relatively minor, one being observed in the market for megayachts. In the markets for the construction of military vessels, ADM is not present in Germany, Sweden or Greece, where TKMS has traditionally had a strong presence. Furthermore, the Commission's market investigation has also confirmed that, in the markets for ship components subject to vertical effects, there is no no risk of downstream foreclosure by TKMS or Atlas Elektronik, a joint venture controlled by TKMS." Circulate...
The analysis took place at the economic level (competition, the effect on prices...) and in no way on the strategic loss and... of technology (even if the sellers certainly deny it). We can't help but feel a little embarrassed to see a "jewel in the crown" (the TKMS group is one of the main European players in the manufacture of frigates) leaving the European bosom to sail elsewhere , without any real debate or in-depth investigation from a point of view other than a calculation of the economic ratio.
A group already well established in Europe
The Abu Dhabi group is a holding company controlled by Al Ain International Group (70%) and Privinvest (30%) and belongs to one of the sheiks of the ruling family of the Emirate of Abu Dhabi, Hamdan ben Zayed El Nahyan. In Europe, it already owns several facilities, including Constructions Mécaniques de Normandie (CMN) in Cherbourg, known for its military production, particularly in patrol boats and other speedboats, and which currently manufactures several Baynunah-type corvettes for the Emirates. The first passed its test at sea in mid-January 2010 and should be delivered in mid-2011 to the United Arab Emirates (with technology transfer at stake!). ADM also carries out its activities at Nobiskrug in Rendsburg (Germany) as well as, on site, at the Abu Dhabi shipyards (United Arab Emirates).
(1) (updated) ADM has also finalized, these days, an agreement with TKMS to acquire the Greek shipyards of Scaramanga. But these are not included in the present Commission authorization (contrary to what may have been written at one time).
(2) In addition, one can read on TKMS and this reconciliation a note from Cirpes written by Louis Marie Clouet.
(Nicolas Gros-Verheyde)
