StormGeo acquires Nautisk – creates one-stop-shop for digital navigation and planning for the maritime industry

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The quote “A little rain never hurt anybody” is not a wise recommendation. At least not if you ask EQT portfolio company StormGeo – the leading provider of weather intelligence and decision support for companies operating in tough climate conditions at sea and onshore. With the acquisition of Nautisk, a global leader within digital charts and publications, StormGeo takes an important step in becoming a one-stop-shop for digital navigation and planning for the modern maritime industry.  
In times of increasing climate change and extreme weather, the need for agile and foreseeable forecasting has never been greater. Headquartered in Bergen, Norway, StormGeo is a trusted partner for companies operating in challenging weather conditions within shipping, oil and gas, renewable energy, aviation, media and cross industries. The company’s diverse employee base, consisting of meteorologists, oceanographers and data scientists, provides tailored weather decision support and route guidance to over 9,000 ships and 1,300 offshore locations on a 24/7 basis, amongst other services.

The add-on of Nautisk is a strategic step in StormGeo’s mission to provide the most innovative and future-proof decision support solutions and services for weather-sensitive operations. With more than 100 years of industry experience, Nautisk offers state-of-the-art digital solutions for vessel navigation, including charts, voyage planning and a digital publication library. Nautisk complements StormGeo’s current maritime solutions and with the add-on, StormGeo will create a unified and complete onboard-to-onshore software platform for maritime navigation and planning.

Rikke Kjær Nielsen, Partner at EQT Partners and Investment Advisor to EQT Mid Market, comments: “The acquisition of Nautisk aligns well with StormGeo’s ambition of becoming the undisputed global leader within premier shipping services. With the combination of Nautisk, StormGeo further cements its position as an industry leader within digital solutions, enabling it to be a trusted partner to its customers on their digital journeys. EQT is excited to support the management team through the next phase of digital transformation”.

Since EQT Mid Market’s acquisition of StormGeo in April 2014, the company has expanded steadily and has grown to become a truly global champion within its sector. Following the acquisition of Nautisk, StormGeo will employ more than 400 employees from 27 offices, including six operations centers operating 24/7/365 supporting customers worldwide, across 15 countries.

During its ownership period, EQT has supported StormGeo in accelerating its digital transformation and strengthening its analytical offering. Actions include completing the strategic add-on acquisition and integration of Silicon Valley-based leader within ship routing and fleet performance, Applied Weather Technology (AWT), as well as launching “Advanced Fleet DSS”, a fleet performance software allowing customers to optimize their fuel consumption based on advanced analytics.

Moreover, StormGeo continues to invest substantially in future-proofing its portfolio to offer its customers state-of-the-art services through the research and development of next generation products within machine learning and advanced analytics.

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3i announces net proceeds of €347m from Scandlines transaction

3I

3i Group plc (“3i”) announces that 3i and funds managed by 3i (together Eurofund V) have sold their investment in Scandlines (“the Company”) for a total equity value of €1.7bn in a transaction with funds managed by First State Investments (“First State”) and Hermes Investment Management, two long-term infrastructure investors representing predominantly European pension funds.

The valuation of 3i’s 55% stake at 31 December 2017 was €744 million (£662 million); the transaction value is at an uplift of 27% to this value. 3i has separately agreed to reinvest into Scandlines at the same transaction value to become a 35% shareholder alongside First State (50.1%) and Hermes Investment Management (14.9%). Net cash proceeds to 3i following the reinvestment will be €347 million, and are expected to be received in the first quarter of FY2019.

Scandlines operates two short-distance, high-frequency ferry routes between Germany and Denmark which provide a critical transport link between Scandinavia and Germany and the rest of Continental Europe. The Company’s eight ferries provide efficient and reliable transportation services to the professional freight and private passenger markets, with more than 42,000 departures annually.

3i, and funds managed by 3i, initially acquired a 40% stake in Scandlines in 2007. They bought a further 10% stake from Deutsche Seerederei in 2010 and acquired the remaining 50% from Allianz Capital Partners in November 2013. Since 2007, 3i has supported Scandlines in its transformation from a state-owned business into a ‘best in class’ operator. To achieve this, Scandlines sold its Baltic and Helsingor-Helsingborg routes and focused the business on two routes linking Germany and Denmark. The transformation also involved investment in the Company to drive sales growth in its core vehicle-transportation business and transform its border shops. In addition, Scandlines invested in green technology and built two new ferries for the Rostock-Gedser route, providing increased capacity and frequency of crossings. Recently, the Company completed an €862 million infrastructure debt refinancing, which received an investment grade rating and substantially reduces its long-term cost of debt.

First State, Hermes Investment Management and 3i intend to support the further growth of Scandlines, including additional investment in green technology. As long-term investors, the three shareholders will continue to support management in the delivery of excellent customer service, safe operations and improving environmental efficiency.

Peter Wirtz, Partner 3i Germany, added:

“During our investment period, Scandlines has been transformed from a state-owned business into an important infrastructure asset securing the central transport corridors between Germany and Denmark. Between 2012 and 2016, the Company has invested c. €365 million in green technology, new ferries and the upgrading of its port facilities to establish itself as a truly sustainable and reliable traffic machine.

Scandlines has been a fantastic investment for us and our re-investment, alongside First State and Hermes Investment Management, into the business reflects our confidence in its continued success. The Company is cash generative and has delivered strong capital growth and income since our investment. We continue to see a robust future for Scandlines and are delighted to continue to invest in such a well-run and strongly performing Company.” 

Marcus Ayre, Partner Infrastructure Investments, First State, added:

“We are pleased to have reached an agreement to partner with Hermes Investment Management and 3i in Scandlines and look forward to working closely with the Scandlines management and employees. 

As long-term infrastructure investors, investing primarily on behalf of European pension funds, we are especially attracted to the integral transport nature of Scandlines. By providing a high-frequency, environmentally friendly, quality service, Scandlines acts as a critical link between the economies of Continental Europe and Scandinavia.”

Peter Hofbauer, Head of Infrastructure at Hermes Investment Management, added:

“Scandlines operates an essential transportation link between Denmark and Germany, and represents an excellent European investment for our portfolio. Our investment in Scandlines is expected to deliver long term stable cash flows, through its focus on excellent customer service, environmental efficiency and safe operations. We are a long-term investor focussed on responsible investment and delivering sustainable and attractive risk adjusted returns for our clients. We look forward to working alongside Scandlines’ high-quality management team, our partners First State and 3i, and local stakeholders, to support Scandlines’ continued success.”

Søren Poulsgaard Jensen CEO, Scandlines said:

“I have enjoyed working with 3i to transform the company and develop its growth potential, and I am looking forward to working with the new consortium. Scandlines is a fantastic company with dedicated employees; we will all benefit from this long-term investment.”

Rothschild acted as financial advisers to 3i and Scandlines on the transaction, which is subject to customary approvals. Deutsche Bank and Macquarie Capital acted as financial advisers to First State and Hermes Investment Management.

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Scanship delivers a strong third quarter

Scanship delivers a strong third quarter

Scanship Holding ASA released their operational update for Q3 2017 yesterday. The strong performance continues and the company reported revenues of NOK 60.3m (Q3 2016 NOK 48.4m) and a solid EBITDA of NOK 9.3m (Q3 2016 NOK 1.9m), representing a margin of 15.3% (up from 3.9% in the same quarter last year).

“The positive results we now see are evidence of our consistent and systematic approach to operational improvements in every part of our business”, says Henrik Badin, CEO of Scanship Holding ASA

Sales and revenues are also growing, reflecting increased demand in the market for advanced environmental technologies and solutions for cleaner oceans. Shipowners and yards involved in the international cruise industry continue to be the main customer segment, but the company has also recently experienced increased attention from other industries, such as fish farming.

Order backlog at the end of September was NOK 328 million. This does not include a contract with the yard STX France for delivery to the world’s largest cruise ship, Royal Caribbean’s fifth Oasis-class vessel. This was confirmed on 4 October and takes the backlog level back to approximately the same as at the end of the second quarter this year.

“As demand for our technology and solutions increases, we will continue our quest for profitable growth by delivering world-class environmental technologies and solutions”, says Henrik Badin.

Scanship is part of Reiten | CO

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