Paramount Group, Africa’s largest privately owned defence and aerospace company, has acquired a majority stake in Cape Town-based specialist ship building company Nautic Africa.
Nautic Africa, started by CEO James Fisher, was established in 2008 and is a provider of speciality high-speed, ballistic protected aluminium patrol vessels, mainly to the military, Coast Guard and oil and gas communities.
Whilst the Paramount Group has its roots in the land forces environment, it recently moved into the aerospace sector with the acquisition of ATE (Advanced Technology and Engineering, now Paramount Advanced Technologies) early this year.
Ivor Ichikowitz, Executive Chairman of Paramount Group, noted his company had been looking to move into the maritime arena and that starting from scratch was not viable. “The acquisition of Nautic Africa,” Ichikowitz explained, “is the last piece of the puzzle to supply customers with complete solutions in the maritime environment.”
Ichikowitz observed that one of the biggest threats facing Africa is not coming from the land or the air, but from the sea in the form of piracy, theft of marine resources and drug trafficking.
The deal to acquire Nautic Africa was put together in early 2013, but the formal announcement was only made at a ceremony at the Nautic Africa facility in Table Bay Harbour on Thursday. Fisher will retain a significant minority interest in the company. It is envisaged Nautic’s current workforce of 100 will double to 200 by 2015.
The acquisition, Ichikowitz said, will combine Paramount’s global market reach and strong track record in Africa with the engineering and design skills of Nautic Africa. This, he continued, will stimulate global demand for Africa’s naval solutions.
Fisher noted that Paramount would bring strength to Nautic Africa. “It brings us pedigree, they will assist in growing to the next step,” said.
Importantly, the ship builder will be able to leverage off Paramount to strengthen their systems and administrative support, as well as gaining access to markets they could not easily access before.
Nautic Africa recently concluded an R600 million deal to build seven 35 metre multi-role patrol vessels for West African clients and is actively working on new orders. The acquisition will further create jobs in the maritime industry as well as the general defence and systems industry.
Due to the growth of the company, Nautic Africa is not only looking to expand its dockyard and ship building facilities in Table Bay Harbour, but may also create a new facility at Saldanha Bay.
The South African Navy (SAN) has expressed a desire for a strong local maritime industry and Fisher is interested in pursuing relationships with the SAN. In order to grow its capabilities, Nautic Africa have partnered with DCNS of France for Project Biro, the acquisition of Offshore Patrol Vessels (OPV). Austal of Australia has also expressed interest in partnering with the Cape company.
Besides the actual building of vessels, Nautic Africa is also looking to growing its leasing business.
As a result of the acquisition, a two brand strategy has been implemented. The Nautic Africa brand will continue to be used for commercial activities, whilst military markets will use the new Paramount Naval Systems brand.