The defense industry is one of the great technological engines, of employment and wealth, but above all it is an enormously important strategic sector for a country. Control over it is essential to avoid depending on third parties in something as important as defense, but in Spain that control is beginning to disappear. Navantia (shipyard) e Indra (sistemista) are currently the only two pillars with clearly Spanish capital in a world, that of defense, where not only a true industrial leader is missing that pulls the cart and caches the sector, but where, above all, companies are gradually moving to foreign hands.
In the last five years, at least five large representatives of the sector have passed into foreign hands. Expal is one of them. the former Explosivos Alaveses SA is part of Maxam, former Unión Española de Explosivos (UEE), which is no longer so Spanish, since currently more than 70% of its shareholding is in the hands of Rhone Capital through Prill Holdins (Luxembourg). Medium and large caliber ammunition, such as the one used by the Siac howitzer of the Spanish Army, or technologies such as the Eimos death carrier vehicle, a candidate to enter the programs of the Marine or Land Infantry, are no longer in Spanish hands.
The nationally manufactured ammunition is not only compromised by the purchase of Maxam, the Granada Munitions Factory (FMG), specialized in large calibers (105-155), is now Slovak and belongs to the MSM company.
Another case, this one from Aeronautic sector, is the old CESA. The Spanish Aeronautical Systems Company is now Heroux Devtek Spain, the fault is 140 million euros agreed in 2018 so that Canadians control, among other things, the production of landing gears of the Tiger helicopters, components of C295 or the charging systems of the A400M.
Also in the aeronautical field, one of the most popular sales was that of ITP Aero, owned before Sener, to the British Rolls Royce. In 2016 an agreement for 720 million was announced, in December 2017 it was approved by the Council of Ministers and in 2018 payments began to be made. Today ITP, manufacturer among other things of components for Eurofighter and A400M engines, It is for sale again, the British no longer want it and everything indicates that it will end up in foreign hands after the sale attempt to Indra is not forged.
360 million euros turned into Inetum the old Iecisa, a computer company of The English Court with stakes as sensitive to its credit as that of Santiago, a system of electronic eavesdropping distributed throughout the peninsula to spy on the communications of ships, planes or ground units in a secret range but that obviously reaches at least Morocco and Algeria, and that is currently updating the logistics system of the Air Force, the SL 2000, and modernizing the Covam (Maritime Action Operations and Surveillance Center) of the Spanish Navy. Well then, INET It is French, specifically from GFI Informatique.
The origin of capital and the company’s flag
The presence of foreign capital in the defense industry is not something new and is a concern for all of Europe. So much so that the issue has reached the highest levels of the EU and what has been decided in this regard is that the origin of the capital does not matter as long as the government of the affected company considers that these companies comply with two main parameters. One is that they continue manufacturing in national soil and the other is that they do it autonomously.
Without going into analyzing the companies mentioned above, which have yet to demonstrate such autonomy, a good example of this can be Santa Bárbara Sistemas. The old national arms factories were sold to the American multinational General Dynamics but they have managed to maintain the independence of their actions and their manufacture on national soil, so for all purposes it is considered by the Government a Spanish company. In these cases, belonging to a foreign fund is not considered a strategic problem.
Why are Spanish companies interested?
What is clear is that foreign investment in strategic national companies is bad news for the independence of a country, but it seems to be a good news for your industrial fabric, so it implies an economic injection to the chosen company. In fact, the fact that foreign funds look favorably on Spain is, for many experts, a sign that the quality and cost structure of certain industries is an attractive. In this case, the interest in the supply chain stands out right now, as explained by defense analyst Enrique Navarro in an IDS Conect webinar.
But what is the reason? Only the solvency and quality of these companies? The truth is that a point to take into account is that Spanish suppliers are currently facing a stage of opportunities with great programs running like the Wheeled Combat Vehicle (VCR) 8×8 Dragon, the frigates F-110 or the modernization of the combat fighter Eurofighter. The question here is why this is so attractive for foreign investors and so little for nationals or the Government itself as a guarantor of such a strategic sector.