MacGregor, part of Cargotec, has entered into an agreement to acquire the major businesses from TTS Group, a global provider of cargo handling equipment and services for merchant and offshore ships for an enterprise value of €87m. The combination of two highly complementary businesses will produce greater scale and diversification and will strengthen MacGregor’s portfolio and market position in key markets for cargo and load handling equipment. Based on preliminary estimates, potential cost synergies are estimated to be around €30m-35m on annual level and are expected to be reached within 3 years from closing.
The acquisition will strengthen MacGregor’s marine and offshore activities in key areas and add further service growth potential through the increased installed base. It will also strengthen MacGregor’s position in China through the strategic joint ventures with Chinese state owned ship building companies CSSC and CSIC. TTS Group ASA and its shipyard solution business, TTS Syncrolift AS, are excluded from the deal.
TTS Group’s main products are a wide range of cargo handling and offshore cranes, RoRo access systems, hatch covers, winches and related services. The company’s service business includes spare parts, maintenance, inspections, modernisation, conversion and training. With a worldwide workforce of around 930 employees, TTS has more than 50 years of experience in the marine industry. The group has subsidiaries in Belgium, Brazil, China, Germany, Greece, Italy, Korea, Norway, Poland, Singapore, Sweden, UAE, USA and Vietnam. TTS operates mainly through three 50/50 owned joint venture companies in China.
The sales of the business MacGregor aims to acquire totalled EUR 161 million in January-September 2017 from which approximately 27% was related to service sales. The net sales of the business aimed to be acquired equals approximately 90% of TTS’ net sales. Operating profit excluding restructuring costs of the business to be acquired was approximately EUR 4 million in January-September 2017. The presented figures are calculated based on full consolidation, but their actual impact on Cargotec’s financials is subject to applied post-acquisition consolidation method of the joint ventures included in the acquisition.