UAE’s Edge and Italy’s Fincantieri launch joint venture to manufacture naval vessels

Edge will hold a 51 per cent stake in the new entity

UAE defence conglomerate Edge has more than 25 companies under its umbrella. AFP
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UAE defence conglomerate Edge is teaming up with Italian shipbuilder Fincantieri to manufacture sophisticated naval vessels and sell them in different markets globally.

With a commercial pipeline worth about €30 billion ($32.42 billion), the new Abu Dhabi joint venture will be awarded “prime rights to non-Nato orders” as well as several “strategic orders by select Nato member countries”, leveraging on the UAE’s government to government arrangements and export credit financing packages, Edge said on Wednesday.

“This strategic agreement significantly enhances Edge's ability to design and build frigates and other large vessels, broadening its range of operations and marking a crucial advancement in the diversification of its maritime solutions portfolio,” Edge said.

Edge will hold a 51 per cent stake in the new joint venture, which also plans to develop an underwater programme for mid-size submarines.

Set up in 2019, Edge specialises in building advanced technology for weapons systems, cyber protection and electronic warfare and has more than 25 companies under its umbrella.

The group has been expanding its portfolio as the UAE, the Arab world’s second-largest economy, focuses on boosting its defence manufacturing capabilities and diversifying its economy from oil.

Last year, it bought a 52 per cent stake in Anavia, which builds unmanned helicopters capable of carrying out mission-critical surveillance, reconnaissance and transportation, to boost its portfolio.

Edge also announced deals including the acquisition of a majority stake in Estonia's Milrem Robotics in February last year to develop capabilities in robotics and autonomous systems in line with the UAE's expanding manufacturing sector.

In March, it bought Trust International Group, an Emirates-based defence trading specialist, to boost its portfolio. It is also teaming up with the Brazilian Navy to develop long-range anti-ship missiles and export them in global markets as part of a deal announced in June.

Through the joint venture with Fincantieri, “we are not just expanding Edge's diverse capabilities in shipbuilding but setting a new benchmark for collaboration and knowledge exchange in the global maritime industry”, said Hamad Al Marar, Edge group managing director and chief executive.

“This partnership embodies our commitment to innovation, leveraging Fincantieri's … expertise to explore opportunities in the global market.”

The new joint venture will focus on sales and commercial operations apart from setting up a dedicated design authority and creating new opportunities for highly skilled Emiratis.

Fincantieri, with a production network of 18 shipyards on four continents, has built more than 7,000 ships, and supplies vessels to navies and the cruise ship industry.

The latest deal comes as the demand for naval vessels continues to surge across the globe amid continued geopolitical tensions and maritime disputes.

The naval vessels market globally is expected to reach $206.43 billion by 2029 from $110.51 billion in 2024, driven by higher demand from North America and the Asia-Pacific region, a Mordor Intelligence report said.

Updated: February 21, 2024, 11:54 AM