We present a new composite mesh finite element method for fluid--structure
interaction problems. The method is based on surrounding the structure by a
boundary-fitted fluid mesh which is embedded into a fixed background fluid
mesh. The embedding allows for an arbitrary overlap of the fluid meshes. The
coupling between the embedded and background fluid meshes is enforced using a
stabilized Nitsche formulation which allows us to establish stability and
optimal order \emph{a priori} error estimates,
see~\cite{MassingLarsonLoggEtAl2013}. We consider here a steady state
fluid--structure interaction problem where a hyperelastic structure interacts
with a viscous fluid modeled by the Stokes equations. We evaluate an iterative
solution procedure based on splitting and present three-dimensional numerical
examples.Comment: Revised version, 18 pages, 7 figures. Accepted for publication in
CAMCo