ROME — Four years after it announced its intention to get out of the rail business, Finmeccanica said on Tuesday it had signed to sell its rolling stock and signals units, cutting its debt by 15 percent and leaving it as a dedicated defense, security and aerospace company.
The Italian group has agreed to sell rolling stock unit Ansaldo Breda and its 40 percent stake in signalling unit Ansaldo STS to Hitachi Ltd. in a deal potentially worth €1.9 billion (US $2.2 billion); euroswhich Finmeccanica said would cut €600 million euros from its €4.1 billion euro debt.
"With this deal, Finmeccanica becomes a pure aerospace, defense and security company," Chief Financial Officer Gian Piero Cutillo told analysts on Tuesday.
Cutillo said that what little non-core business remained in the group's portfolio accounted for less than 1one percent of Finmeccanica's €14 billion euros in sales.
While Ansaldo Breda has faced losses, Finmeccanica's 40 percent share in profitable Ansaldo STS, which saw sales of €1.3 billion euros last year, is likely the will have proven the main draw for Hitachi.
The sale was central to the rationalization plan launched by Finmeccanica CEO Mauro Moretti, who has said he wants the firm to focus on defense, security and aerospace.
Moretti has also said he may find is considering finding a partner to run the group's US unit DRS, or even selling the unit.
Email: tkington@defensenews.com
Tom Kington is the Italy correspondent for Defense News.
