Leonardo is divesting its business line responsible for making torpedos.
The defense company signed a definitive agreement with Fincantieri, one of the biggest shipbuilders in Europe, for the sale of Underwater Armaments Systems for up to $447 million.
In a press release, Leonardo said Fincantieri will pay a fixed amount of about $323 million for UAS. Leonardo will get up to $124 million more if it meets set targets for fiscal 2024.
“The disposal of the Underwater Armaments Systems is part of the plan of rationalizing Leonardo’s business portfolio,” said Roberto Cingolani, general manager and CEO of Leonardo.
“The initiative gives further emphasis to the cooperation between Leonardo and Fincantieri, within the framework aimed at achieving more effective defense and global competitiveness.”
UAS, previously Whitehead Alenia Sistemi Subacquei, was initially a subsidiary under Leonardo. Its name was changed in 2016 when it merged with the Rome-based company.
The business unit makes MU90 light torpedoes used by navies around the world, including the Royal Australian Navy.
In 2023, UAS reported revenues of about $172.4 million.
The transaction is expected to close in early 2025.