The board of aerospace and defense firm has approved plans for a new organizational and operating model in a bid to return the company to profitability.
The company, which is saddled with large debt and low credit ratings, says it is planning a wholesale change similar to the re-formation undertaken by— which renamed itself as Group at the beginning of this year — and will focus its transformation efforts on the aerospace, defense and space sectors of the company, which will become core areas.
The company is looking to divest itself of its transport and energy units.
Two Chinese companies recently have expressed interest in buying Finmeccanica’s rail unit Ansaldo STS and money-losing train maker Ansaldo Breda.
The moves, led by Chairman Gianni De Gennaro, are “in line with similar initiatives promoted by our main competitors aimed at effectively tackling the challenges posed by the transformations affecting the international scenarios of reference,” the company said in a March 6 press statement.
, AleniaAermacchi, Selex ES, OTO Melara, WASS and SuperJet International will be affected by the change. Other firms in the group, including DRS Technologies and FATA, will be managed separately.
Finmeccanica says it wants to ensure higher profitability, sustainability, and cash flow generation.
The company says the changes will result in targeted initiatives aimed at shortening reporting lines, increasing the organization’s effectiveness and improving management efficiency. “Finmeccanica will be able to enhance its role on international markets and in the reconfiguration processes of the sector of reference worldwide and it will also strengthen the growth of the Italian high-tech manufacturing industry,” the company says.
“Finmeccanica will achieve a more effective production function [and] a higher level of industrial productivity, will exploit economies of scale and scope and will increase competitiveness, thus pursuing economic benefits in the medium term,” the company adds.