02/11/2018
Geir Håøy CEO and President KONGSBERG
About the acquisition
Overview
- Kongsberg Gruppen acquires Rolls-Royce Commercial Marine ("RRCM") and further strengthens its position as a global technology leader in the maritime industry
- RRCM to become an integrated part of Kongsberg Maritime
- Enterprise value of GBP 500 million
- Acquisition to be financed through a combination of rights issue and issuance of bonds
- Closing of the transaction is expected to take place in Q1 2019 and is subject to regulatory approval
The acquisition is according to Group Strategy
KONGSBERG is a Technology Power House with a common core
MARITIME
Expand scope from our leading positions
DEFENCE
Increase market penetration with a modern product portfolio
TECHNOLOGY OPPORTUNITIES
Drive our competitive technology base for new positions
Growth and value creation – spin off between civil and defence – positioning for future opportunities
A unique opportunity
WORLD CLASS – Through people, technology and dedication
In lead of transforming the maritime industry
Timing is right
The upside is significant
5
Rolls-Royce Commercial Marine is a world leading technology company
World leader in vessel design, complex system integration, and supply support of power and propulsion equipment and deck machinery
Operates a global service network and 24/7 support via more than 700 service engineers. Also operates advanced training facilities
A thought leader in the emerging area of ship intelligence, including remote and autonomous vessels, and demonstrating offerings in this field
3,600 employees, serves more than 4,000 customers, operating 25,000 vessels with an installed base of some 100,000 products
Highly complementary
Increasing our strategic importance with customers and partners
The combination of KM and RRCM will have a "full picture" offering across mission critical marine systems - enabler for improved system integration
World Class global network
WORLD CLASS – Through people, technology and dedication 8
Shaping the maritime future
INTEGRATED SOLUTIONS DIGITALIZATION REMOTE SERVICES AUTONOMY
Creating a global leader – from bridge to propeller
Highly complementary portfolios
- A broad range of complementary World Class maritime products
- Allowing for seamlessly integrated solutions throughout the vessel
- A strategic partner for improving efficiency and operational capabilities of the vessels
World class global network
- A strong global sales- and service network across 34 countries
- Global reach, local presence wherever the customers are
- Servicing a combined installed base of approximately 30,000 vessels
Shaping the maritime future
- Combining the best of the maritime industry's leading engineering capabilities
-
Industry leadership in today's as well as future technologies such as digitalization, remote operations and autonomy
-
Complementarity enables scale
- Synergies allow for more efficient operations
- An even more robust and competitive organization
KM + RRCM
=
A PERFECT FIT
Transaction Considerations
Gyrid Skalleberg Ingerø CFO KONGSERG
Strong balance sheet
|
Q3
2018 |
Q2
2018 |
2017 |
| Gross interest bearing debt |
3 326 |
3 337 |
3 340 |
Cash and short-term
deposits |
2 990 |
2 630 |
2 956 |
| Net interest bearing debt |
336 |
707 |
384 |
Equity
ratio |
35.5 % |
35.1 % |
35.6 % |
| ROACE |
10.8 % |
9.4 % |
9.1 % |
Rolls-Royce Commercial Marine key financials
15%
Engines
EA&C
Significant cost and revenue synergy potential
- Expected annual run-rate cost synergies in excess of NOK 500 million
- Synergies expected to reach run-rate by 2022, with approximately 75% achieved by end of 2020(1)
- Implementation and integration costs of approximately NOK 450 million
- Revenue synergies from cross-sales and broader scope on aftermarket sales
Transaction details
- The transaction and turn-around costs will be funded through
- NOK 5 billion rights issue
- Additional bond financing
- Norwegian Government committed to subscribe for their pro rata share, i.e. 50.01% in the right issue
- Remaining 50% is underwritten by a group of shareholders (19.9%) and a syndicate consisting of DNB and Danske Bank (30.1%)
- The transaction is subject to regulatory approvals and other customary closing conditions
- The parties expect to close the transaction in the first quarter of 2019 or early in the second quarter of 2019
Rights issue terms
Thank you