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Romania Cancels Naval Group’s $1.32 Billion Deal

Romania Cancels Naval Group’s $1.32 Billion Deal

Defence firm Naval Group won the contract to build four Gowind 2500 multi-mission corvettes for Romania and renovate two existing frigates for $1.32 billion in 2019 in partnership with Romanian company Santierul Naval Constanta.

But the deal was held up, first by legal challenges and then by the two companies that disagreed on financial aspects.

The country, which shares a 400-mile border with Ukraine, hosts a U.S. ballistic missile defence system and, as of last year, has a permanent NATO battlegroup stationed on its territory led by France.

Romanian Defence Ministry issued a warning on June 14, 2023, to indicate that the deal might be cancelled. The Romanian Defence Ministry (MApN) addressed the pending Corvette contract. Minister Angel Tîlvăr said they expect a response from Naval Group, a renowned French naval corporation, before the week’s end.

The progress has been delayed due to financial disagreements between the Naval Group and the Constanța Shipyard.

Turkish STM company also aspired to modernise Type 22 class frigates, which were aimed to be modernised after being procured from the United Kingdom in 2016. After some rumours that STM won this tender, the tender was cancelled, and the modernisation was combined with the tender for purchasing four new corvettes. Thus, a tender was created in the form of the purchase of 4 new corvettes + the modernisation of 2 frigates. STM was out of the tender since only European Union member countries could bid on this new one.