Leonardo Diversifies Naval Tech Portfolio by Acquiring a 30% Stake in GEM Elettronica

Leonardo has secured a 30% ownership of share capital in GEM elettronica, an Italian firm renowned for its development of compact and mid-sized 3D radars, electro-optical sensors, and inertial systems catering to the naval, aerial, and terrestrial sectors. This strategic maneuver will enhance Leonardo’s position in the naval electronics industry, particularly focusing on short and medium-range sensors. Leonardo is poised to broaden and diversify its offerings while optimizing the engineering, production, and marketing of products across various bands compared to its current portfolio.

GEM operates within complementary market niches to those of Leonardo, providing competitive systems such as navigation radar, coastal monitoring, electro-optical devices, and fiber-optic gyroscopes. Additionally, GEM is actively engaged in maritime and border surveillance markets. The company possesses the capability to manufacture essential components for Leonardo products as well as specialized radar and electronic technologies.

In addition to acquiring 30% of GEM, Leonardo has formalized a commercial and industrial agreement with the firm. This partnership will facilitate the development of synergies where GEM’s unique expertise aligns with Leonardo’s operations, encompassing collaborative marketing efforts and joint research and development initiatives. Key areas of collaboration will cover the naval/maritime sector, critical infrastructure, and applications for terrestrial platforms.

GEM elettronica employs approximately 130 individuals and manufactures its offerings predominantly in-house. Engaged in both civil and military markets, the company maintains a presence in Italy and internationally, forging partnerships with leading market players within and beyond Italy. GEM has long served as a supplier to Leonardo, contributing to various projects, including collaborations on the FREMM program and the Italian Navy’s fleet modernization initiative known as the “Naval Law.”

According to the agreement, Leonardo may boost its ownership in GEM’s share capital and obtain control of the firm through a purchase option that can be enacted in 2024. The collaboration is designed to bolster capabilities aimed at enhancing competitiveness in the long run, in alignment with Leonardo’s strategic vision “Be Tomorrow – Leonardo 2030.”