On the Record with ROBERTO TESTORE, CEO AND MANAGING DIRECTOR, FINNECCANICA
"Our strategic plan is very clear," says Finmeccanica
head Roberto Testore. "It's to grow in the aerospace and defense
sector, and quickly, before we miss the boat, and to expand abroad,
while taking care to protect our financial position. We will concentrate
on our core business. Finmeccanica today is perhaps Italy's only
truly high-tech company. This is confirmed by our spending on R&D,
which stood in 2001 at around 800 million euros and last year was
over one billion euros, or 13% of our value of production."
"This strategy is reflected in the way we have expanded over
the last year-by buying Aermacchi, Marconi Mobile and Telespazio-without
eating too far into our finances, which remain extremely sound,
considering that even after making acquisitions worth around one
billion euros, our debts are still only just over 200 million euros."
A 30% stake in FiatAvio brings Finmeccanica into a new business,
aero engines. There has also been increased speculation that FiatAvio
could be merged with Germany's MTU. Testore says, "The MTU
issue hasn't been considered yet. We will look at it, but clearly
any offer for MTU will be made by the 'new' FiatAvio, not by Finmeccanica.
It is too early to say if there will be an offer for MTU, but the
two companies combined would make a strong group, particularly in
the military sector and in dealings with their main partners, General
Electric, Pratt & Whitney and Rolls Royce."
Finmeccanica has been very aggressive in forming transatlantic
relationships, with Lockheed, Boeing and the Carlyle Group, and
hopes to play a big role in the JSF program. Some say this is at
the expense of European co-operation, suggesting even that Italy
has become a 'bad European.'
Testore strongly disagrees. "This view is rather wide of
the mark. Apart from Eurofighter, Finmeccanica is involved in three
very important joint ventures with European partners: it works with
British group GKN in AgustaWestland, the world leader in helicopters;
with BAE Systems in defence electronics group AMS; and with EADS
and BAE Systems in the missiles joint venture, MBDA. We are also
a shareholder in Arianespace, we have a 4% stake in the A380 program
through Alenia Aeronautica (which also works with Airbus Industrie
in many other programs), and we are part of the TIPS initiative
for NATO AGS through Galileo Avionica. In the space business, Alenia
Spazio is one of the consortium leaders for the Galileo program
and partners French companies in the CosmoSkyMed project. In naval
weapons systems, Finmeccanica works with French groups on the Horizon
frigate program, and OTO Melara and WASS are developing some of
their core products in partnership with German and French companies
in naval and land weapons systems.
"At the same time, Finmeccanica clearly has a long tradition
of relations with U.S. companies, but this certainly does not mean
that U.S. partners have been chosen at the expense of European co-operation."
Asked where Finmeccanica now stands vis-a-vis BAE Systems on military
aircraft following the collapse of the EMAC plan, and if the much
touted partnership is still possible, Testore says, "our main
goal with BAE Systems is to form a wide-ranging strategic agreement
in defense electronics in the near future. We are currently looking
at various partnership possibilities and have the support of our
governments. It is too early to say what form this agreement will
take, as we still need to examine many factors in detail. Clearly
though, Finmeccanica and BAE Systems could work together in many
other areas of the aerospace and defense business.
