Cargotec Sells Navis Business for €380M
March 26, 2021
Cargotec has announced that it has sold its Navis business, which it acquired in 2011 for US$190m (approximately €132M).
Commenting on the deal, Cargotec said it “will have approximately EUR 230 million positive impact on its operating profit in 2021. The final purchase price will be determined based on customary working capital and debt-like adjustments at closing. The gain will be reported as an item affecting comparability and it does not impact Cargotec’s outlook for 2021 published on 4 February 2021 in conjunction with the company’s financial statements review. Transaction is subject to normal regulatory approvals and works council consultation in relevant jurisdictions. Closing is expected by the end of Q3 2021. In 2020 Navis recorded sales of EUR 107 million.”
This is the third time Navis has been sold, and the company is certainly a much larger business than when Cargotec bought it. Under Cargotec Navis added Interschalt Marine (which itself had just completed an acquisition) for an undisclosed price, Cetus Labs, which developed the Octopi TOS for €10.8 million; Jade Logistics for €4.3M, and Biarri Rail in 2020 for €8.2M. In its 2020 financial statements Cargotec assigned the Navis business a book value of US$185.7M.
Owning Navis never turned out to be the value generator Cargotec was expecting. As noted above its 2020 sales were €107M, which is understood to be just over half of Cargotec’s corporate target, according to people familiar with the company.
Navis proved to be significantly less of an advantage in growing its Kalmar automation business than Cargotec was expecting. In addition, the vision of linking the vessel-based software products from Interschalt Marine with terminal and intermodal software from Navis in the Cloud-based platform called XVELA did not gain much traction with the leading carriers. At the same time venture capital interest in the supply chain and the software linked to it is extremely high.
Navis’s new owner Accel-KKR is a Silicon Valley-based technology-focused investment firm that has invested in over 250 companies in the last 20 years. It typically invests “mid-market software and technology enabled services companies” with a focus on driving growth, including helping its investments make acquisitions.
That M&A activity is what leads to Navis. In August 2020 Accel-KKR took a majority stake in NAVTOR, which provides e-Navigation services for some 7,000 vessels. NAVTOR then launched a fleet management software application called NavFleet. Continuing in this direction, last month Accel-KKR provided funding for NAVTOR to acquire Tres Solutions, a “vessel performance optimisation platform” with a focus on reducing fuel consumption.
Announcing the Tres Solutions acquisition, Aaron Holton, President & CEO of Tres, said that: “Shipping companies are increasingly looking for a total ship operations platform, helping them simplify workflows, improve the speed and reliability of their operations, and facilitate better decision-making”. The Navis vessel products include the MACS3 loading computer and the Stowman and Capstan stowage planning tools that were initially developed by Interschalt Marine. These are a logical fit for NAVTOR.Read the full article >>