Rheinmetall has decided not to participate in the first bidding round for the acquisition of Romania’s Mangalia shipyard, a move that underscores the German defense contractor’s cautious approach to the asset’s valuation.
The company, which is slated to modernize the facility as part of a €920 million project funded through the National Recovery and Resilience Plan, is instead waiting for the shipyard’s value to fall to its liquidation price before making a move.
The decision comes after significant market turbulence for Rheinmetall, with shares (RHMG.DE) tumbling approximately 17% in early Tuesday trading.
This sharp decline marked one of the steepest single-day drops for the defense giant in recent memory, driven by mounting concerns over the execution risks and financial implications of the Mangalia project.
Investors appear to be pricing in the potential delays and renegotiations that may arise from Rheinmetall’s refusal to engage in the current tender process.
Romanian interim Defense Minister Radu Mărgineanu has been closely monitoring the situation, as the modernization of the Mangalia shipyard is a critical component of Romania’s defense infrastructure upgrades.