Kongsberg has made its largest acquisition with the £500m purchase of Rolls-Royce’s commercial marine business.
Rolls Royce vision for an autonomous ship
The sale follows a strategic review by Rolls-Royce of its Commercial Marine operations announced in January 2018.
Based in Norway and active in over 25 counties, Kongsberg provides automation, navigation and control systems to customers the oil and gas industry, merchant marine, defence and aerospace sectors.
The acquisition includes propulsion, deck machinery, automation and control, a service network active in in over 30 countries, and ship design capabilies. Rolls-Royce’s Ship Intelligence activities, which have been developing technologies for remote and autonomous operation of commercial vessels, are also included.
“The maritime industry is becoming increasingly globalised and is undergoing considerable technological and market driven changes,” said Geir Håøy, CEO and president of Kongsberg. “With this acquisition we will strengthening our strategic position with shipowners, shipyards and other customers and partners.”
Kongsberg will continue to have access to products from Bergen Engines, which remains part of Rolls-Royce Power Systems, an entity that will continue to supply MTU engines to customers including operators of commercial vessels and yachts. The naval gas turbine propulsion activities will continue to be a core part of Rolls-Royce Defence.
Warren East, chief executive of Rolls-Royce, said: “This transaction builds on the actions we have taken over the last two years to simplify our business. The sale of our Commercial Marine business will enable us to focus on our three core businesses and on meeting the vital power needs of our customers.”
The transaction has been approved by the boards of both Rolls-Royce and KONGSBERG and is expected to close in the first quarter of 2019, subject to regulatory clearance. Rolls-Royce anticipates net proceeds of £350m to £400m from the deal that will be used to ‘judiciously pursue opportunities that will drive greater returns for the group’.