Aker, Kvaerner Merger Proposed

Thursday, March 01, 2001
Norwegian industrialist Kjell Inge Roekke proposed merging his Aker firms with the shipbuilding and oil and gas divisions of Kvaerner on Wednesday to combat stiffening world competition. Aker forecast synergies from 2003 worth $89-$112 million, from the link-ups, the latest in a string of proposed ties between the two groups, which are struggling in a dwindling Norwegian oil and gas services market. "We expect that most of Kvaerner's shareholders will accept this," said Roekke, a billionaire investor whose interests range from fisheries to building oil platforms. Kvaerner welcomed proposed talks on shipbuilding but reacted frostily to the suggested tie-up in oil and gas, saying it would not help the company to meet future challenges. It said Aker over-estimated synergies. Shares in Roekke's majority-owned oil and gas services group Aker Maritime, which is Kvaerner's biggest shareholder with 17.8 percent, closed two crowns firmer on the Oslo bourse at 73 crowns, while Kvaerner shares gained two crowns to 69. The total index of the Oslo bourse ended down 0.1 percent. "It looks like a good plan overall, so investors are giving it a cautious welcome," one analyst said. "But there are a lot of uncertainties -- many people don't trust Roekke, and Kvaerner's board may not back it." Roekke stopped short of making any concrete offers of cash or shares. In the past, Kvaerner has opposed Aker's suggestions of a merger of the oil and gas divisions after Aker sold its key deepwater division to France's Coflexip Stena Offshore last year for $513 million. Kvaerner said the offer did not add any "substantially new elements...in an evaluation of what would serve Kvaerner's shareholders best in the future." Under the new plan, Roekke's fully-owned Aker RGI industrial holding company would merge its Aker Yards shipbuilding unit and Kvaerner's shipbuilding division. Kvaerner would end up with less than 50 percent, Aker said. "The new unified shipyards company will become a leading shipyards group in Europe with some 12,000 employees and annual revenues in the order of $1.68 billion-$1.90 billion," the company said. Aker Yards has operations in Norway, Germany, Finland and Romania. Kvaerner has shipyards in Finland, Germany and the United States -- all are up for sale as part of a restructuring. Separately, Aker Maritime reiterated its goal of a merger with Kvaerner's oil and gas services division. The group would also take on parts of Kvaerner's other core area, engineering and construction. Roekke would end up as the largest shareholder of the combined oil and gas group, although it is not clear whether he would hold majority control. "This will create a profitable and future-oriented Norwegian-based oil and gas technology company with a sound base in its domestic market and with a major international potential," Aker Maritime said. It said one possibility was for Aker to transfer its oil and gas division to Kvaerner in return for payment in non-voting preference shares and cash. Aker predicted that the deal would need approval by Norwegian and British competition authorities but not by the European Commission. Aker said that Kvaerner's two core areas of oil and gas and engineering and construction would have turnover of 47 billion crowns in 2003 and operating profits of almost 3.0 billion after a link-up with Aker. It would have up to 26,000 employees. Kvaerner would retain separate divisions, such as pulp and paper and a venture in launching space satellites. -(Reuters)
Maritime Reporter October 2014 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

Shipbuilding

MacGregor Deck Equipment for Intership's Eco-bulkers

MacGregor, part of Cargotec, has secured a deck equipment contract from New Times Shipyard in China for Intership Navigation Co Ltd.'s three new 36,500 dwt laker-class bulk carriers.

Seacor Takes Delivery of 10,800 HP Crewboat

Seacor Marine is building ever larger and more powerful mono-hull crew/supply boats. The first of these to be delivered is the 202x34-foot Alex F. McCall with some very impressive statistics.

Choosing the Best Financing Proposal

It isn’t always about the rate. In a robust boatbuilding market – like the one we see now – even the most successful, financially stable operators need to borrow.

Navy

Subsea Defense & the Changing Paradigm of Submarine Programs

Technology and dynamic mission profiles have driven change in the defense industry, Hydro Group Plc Managing Director Doug Whyte, explores the changing paradigm of submarine programs,

Rolls-Royce Wins US Marine Corps Contract

Rolls-Royce has been awarded a new, two-year contract to provide aftermarket engine support for the US Marine Corps and Air Force V-22 fleets, which provides

US Navy Evaluating SEWIP for LCS

The U.S. Navy is evaluating a scaled-down version of the Surface Electronic Warfare Improvement Program (SEWIP) system for potential incorporation on future Littoral Combat Ships (LCS),

 
 
Maritime Contracts Maritime Standards Naval Architecture Navigation Offshore Oil Pipelines Ship Electronics Ship Repair Ship Simulators Sonar
rss | archive | history | articles | privacy | terms and conditions | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.1256 sec (8 req/sec)