Posted on July 24, 2024
The news: Shipbuilding companies Austal and Civmec have agreed to a joint venture to submit a proposal to the federal government to deliver enhanced transport and littoral manoeuvre capability to the Australian Army.
The numbers: Shares in Civmec rose 5.3% to $1.19, while Austal lowered 1% to $2.54, by 10:45am AEST.
The context: Under a memorandum of understanding between the two companies, ASX-listed Austal and ASX- and SGX-listed Civmec aim to submit tenders to the government for the project, named LAND8710 Phase 2, Landing Craft Heavy (LC-H).
The companies said the joint venture would allow the army to have greater capacity and reach over the Indo-Pacific region.
The joint venture is intended to contract directly to the government to undertake shipbuilding tasks for the project within the assembly hall at Civmec’s facility in Henderson, Western Australia.
What they said: Civmec executive chair Jim Fitzgerald said: “The proposed joint venture between Austal and Civmec will be an important step to ensure the continuation of naval shipbuilding at Henderson, with tenders, detailed scopes and commercial arrangement now able to be finalised at pace”.
“By combining Civmec’s Henderson shipbuilding facilities, which include the largest heavy engineering facility of its kind in Australia, our systems, steel manufacturing expertise and 4,000 strong labour force, together with Austal’s naval shipbuilding experience and long track record of delivery, the JV would be very well placed to deliver efficient continuous naval shipbuilding in Western Australia to Defence.”
