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The UK CMA blocks the merger between Cargotec and Konecranes

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The UK CMA blocks the merger between Cargotec and Konecranes. Image: Pixabay
The UK CMA blocks the merger between Cargotec and Konecranes. Image: Pixabay
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The UK Competition & Markets Authority “CMA” has blocked the merger between Cargotec and Konecranes. According to the CMA’s final report issued, the remedies – which would have removed all overlapping businesses of the two companies and were accepted by the European Commission – would not be effective in addressing the CMA’s concerns and thus the planned merger between Cargotec and Konecranes cannot be completed. The completion of the planned merger would have required approvals from all relevant competition authorities. Thus, Cargotec and Konecranes have today decided to cancel the planned merger.

Cargotec and Konecranes have obtained clearances for the planned merger from numerous competition authorities. As announced in February 2022, the EC conditionally approved the planned merger between Cargotec and Konecranes on the basis of the same remedy package rejected by the CMA, which comprised commitments to divest Konecranes Lift Truck business and Kalmar Automation Solutions. In addition, the State Administration for Market Regulation and nine other jurisdictions have approved the planned merger.

In addition to the clearances of the above competition authorities, completion of the merger remained subject to further approvals from various other competition authorities, including the Department of Justice in the United States, with whom Cargotec and Konecranes have been in continuous dialogue.

In response to feedback received from the CMA during the course of their investigations, the boards of directors of Cargotec and Konecranes carefully considered amending the remedy package offered to the EC further, as well as offering alternative remedy packages to address the concerns raised by the CMA. The boards of directors did not, however, find any satisfactory solution which would have addressed the concerns of the CMA and which would have been in the best interest of the shareholders of Cargotec and Konecranes, and of the combined company, without jeopardising the rationale of the proposed merger as presented in October 2020.

As a consequence of the CMA’s negative final report, the boards of directors Cargotec and Konecranes have therefore concluded that it is in the best interest of each of Cargotec and Konecranes and their respective shareholders that the merger is cancelled.

Ilkka Herlin, the Chairman of Cargotec stated: The Board of Cargotec is convinced that the merger would have created substantial value for the entire industry as well as shareholders by improving sustainable material flow. The combination would have created a strong European company enabling accelerated shared abilities to innovate without harming competition. We have done all we could to realise the merger and are disappointed that our plans have had to be abandoned. After a long and extensive regulatory review process and merger planning preparations it is time to shift our full focus on executing Cargotec’s own strategy and value-creation opportunities.

Christoph Vitzthum, the Chairman of Konecranes stated: The combination of Konecranes and Cargotec, as planned and announced on 1 October 2020, would have created a company that would have been greater than the sum of its parts. The merger control process has been extensive and the investigations thorough, and Konecranes Board of Directors is disappointed that the remedy package offered did not satisfy the concerns of all regulators. At the same time, we believe that further remedies would have not been in the best interest of Konecranes’ shareholders as they would have changed the strategic rationale of the transaction. Konecranes will continue to drive its strategy and pursue value-creation potential on a stand-alone basis.

Cargotec and Konecranes will immediately cease the pursuit of the merger and the related processes and continue to operate separately as fully independent companies.

By the end of 2021, Konecranes had booked EUR 56 million and Cargotec EUR 57 million of merger related transaction and integration planning costs. The total transaction cost estimate of EUR 125 million (excluding integration planning costs) remains valid. The final transaction and integration planning costs will be reported when available.

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Container Terminal

Konecranes to deliver first hybrid RTGs to Africa

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Konecranes to deliver first hybrid RTGs to Africa. Image: Konecranes
Konecranes to deliver first hybrid RTGs to Africa. Image: Konecranes
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Konecranes has received an order from the Matadi Gateway Terminal in the Democratic Republic of the Congo for four hybrid RTGs. These will be the first hybrid RTGs operated in Africa by the Congo River in the city of Matadi. As a world first in the container handling industry, Konecranes now delivers hybrid and electric RTGs to customers as carbon neutral. Carbon emissions are minimized wherever possible in the manufacture of the cranes and the remaining emissions are compensated with re-forestation, up to the point of hand-over to the customer. This order was booked in the first quarter of 2022 and the hybrid RTGs will be delivered by March 2023.

International Container Terminal Services and La Société De Gestion Immobilière Lengo jointly run the Matadi Gateway Terminal in the Democratic Republic of the Congo. The new hybrid RTGs will enable MGT to handle increasing container traffic. “This is a breakthrough for both DR of the Congo and Africa as a whole, where container terminals are looking for ways to reduce their carbon footprints. These are their first RTGs and a big step forward in their container handling ability that will help them to reach their growth goals,” said Matti Talala, Sales Manager, Port Solutions, Konecranes. This hybrid choice of MGT is fully in line with MGT’s ongoing environmental policy.

MGT opened for business in 2014 and has since grown to reach 175,000 TEU of capacity. The new hybrid RTGs will handle containers with high eco-efficiency thanks to their hybrid drives. A hybrid Konecranes RTG is operated with electrical power from batteries and a diesel generator. During normal use, power is drawn from the batteries. During peak use, power is drawn from the batteries and diesel generator together. The hybrid RTGs for MGT will have built-in readiness for fully electric operation and they will have the smart features Auto-steering and Stack Profiling with a lifting capacity of 40t. This design and configuration will increase MGT’s capacity to 400,000 TEU by doubling the yard area.

This is part of Ecolifting, Konecranes’ continuous work to decrease the carbon footprints of our customers. From eco-optimizing diesel drives to hybridization and fully electric fleets, we will continue to do more with less.

A strong focus on customers and a commitment to business growth and continuous improvement make Konecranes a lifting industry leader. This is underpinned by investments in digitalization and technology, plus our work to make material flows more efficient with solutions that decarbonize the economy and advance circularity and safety.

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Maritime

Kongsberg Digital to provide vessel insight to Floatel International

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Kongsberg Digital to provide vessel insight to Floatel International. Image: Kongsberg Digital
Kongsberg Digital to provide vessel insight to Floatel International. Image: Kongsberg Digital
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Floatel International provides top-quality offshore Floatels for extreme conditions, and will now become a part of and benefit from Kongsberg Digital’s digital infrastructure Vessel Insight.

Floatel is currently operating in the North Sea region, Australia, Gulf of Mexico and Brazil and have a fleet consisting of five semi-submersible accommodation and construction support vessels. The company is systematically working to reduce its emissions and optimize its operations. As a part of Kongsberg Digital´s infrastructure Vessel Insight, the goal is to gain better control and smarter solutions through digitalization. Vessel Insight will be deployed on all of Floatel International´s operational rigs.

“We are excited to be a part of Floatel International on their digital journey. They are experts in working under extreme conditions, and we are proud they have chosen us to support them in reducing emissions and proving optimal operations through digitalization.” said Andreas Jagtøyen, Executive Vice President of Digital Ocean in Kongsberg Digital.

“One of our main focus areas is data-driven decarbonization. We hope to get the most out of apps such as Maress and will hopefully get better use of our fuel management data. With the Vessel Insight infrastructure and the Kognifai ecosystem, we have all our digital solutions in the same place and greater opportunities for further digitalization.” commented Alexander Östberg, Technical Manager at Floatel International.

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Intermodal Transport

RUSCON implements its multimodal service between Russia and Israel

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RUSCON implements its multimodal service between Russia and Israel. Image: Delo Group
RUSCON implements its multimodal service between Russia and Israel. Image: Delo Group
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In June 2022, a logistics operator RUSCON, successfully implemented the first shipment of 90 40-foot containers, as part of its new multimodal service between Russia and Israel. The shipment was sent by sea from Novorossiysk to the port of Ashdod. The purpose of these shipments is to link the regions of our country with the Israeli ones through the seaports of the two states.

Transportation within Russia is provided by RUSCON regular services. The consolidation points in Novorossiysk are RUSCON ‘s own terminal and the NUTEP Container Terminal. The sea transportation shoulder is fully organized by RUSCON.

Currently the frequency of calls to Novorossiysk for this service is once in two weeks. Last mile service is available to RUSCON customers in Israel.

Commenting on the new service Andrey Chernyshev, the Senior Vice-President of RUSCON, said: “Under the conditions of partial uncertainty of the situation in the world, RUSCON is doing its best not only to maintain the existing logistic chains, but also to create new ones. Undoubtedly, the launch of the new service in Israel is a significant progress in expanding the geography of RUSCON ‘s multimodal services on the Black and Mediterranean seas.”

He continued, “Such development makes it possible to offer our clients secure solutions for transportations in import-export directions. High demand for the service is evidenced by the loading of cargoes of Israeli manufacturers to Russian cargo owners already in the first call. Partaking of several Delo Group’ assets in the Russia-Israel service allows us to achieve a significant synergy effect and minimize the impact of the current negative factors”.

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