Monday, January 7, 2013

Defense: France has the means to maintain a powerful explosives industry

The State has authorized the SNPE to participate in a capital increase of more than 90 million Eurenco its subsidiary, specializes in the manufacture of explosives for ammunition, small shells and missiles. An operation that could be the prelude to a reconsolidation of the explosives industry.

Eurenco a general meeting of a company specializing in the manufacture of explosives for ammunition, small shells and missiles, was approved at the end of the year a capital increase of € 93 million, which will be used to build such a new ultramodern factory in Avignon (Vaucluse), whose code name is Project Phoenix. Participation SNPE this will be done in cash to the tune of 70 million euros and by contribution in kind of real estate assets located in Avignon (13.1 million) and Bergerac (10.33 million euros). Tenant SNPE, Eurenco becomes owner today. Finally, the operation maintains the participation of SNPE Eurenco capital of 99.99%.

Already in the heart of summer, the state had authorized in late July, during a Board of Eurenco, the construction of the new plant in Avignon near the old one, which will run until opening of the new site. The new entity should be commissioned at the end of the first quarter of 2014. Work will begin in early 2013.The amount of work is estimated at approximately 90 million euros. So, Eurenco, which can start the work, will find additional funding, says it "La Tribune".

To a restructuring of the sector and explosive powder

This could finally give the start of the restructuring of the industry of explosives French. Nexter will he the pivot of the consolidation of powders and explosives? It was the will of the previous government. The option was always defended by the Ministry of Defence at the end of the summer. The group public land armaments could get their hands on all the activities of explosives SNPE (900 employees in 2011), which Eurenco. A total of nearly 208 million euros in turnover.

Parallel to this, Eurenco has yet to finalize the sale of its loss-making activities in Finland, based in Vihtavuori (ten million sales). "Either we farm, or the Finnish government initiated the resumption of this activity via a local industrialist," explained at the end of the summer a close case. Helsinki looks for takeover by a local actor of this site, which specializes in the manufacture and marketing of propellant and ignition civilian and military ammunition. Finally beyond SNPE CEO, Antoine Gendry, had also begun to initiate discussions with a view to consolidation at European level with rival Nitrochemie, a joint venture between Rheinmetall and Swiss Ruag.

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