Cargotec CEO: Marine Unit to be IPO-Ready by Year-End
Finnish cargo handling equipment maker Cargotec's marine unit will be ready to run independently by the end of the year and can list in Singapore any time after that, Cargotec's new chief executive said.
Mika Vehvilainen said the exact timing of the IPO for the MacGregor unit, which makes hatch covers and cranes for ships and is the company's most profitable business, depends on a recovery in market conditions.
"You need to carve out the business.... That will be done by the end of this year," Vehvilainen told Reuters when asked of preparations for the listing, which the company has said would take place in the first half of 2014 at earliest.
"When the market conditions are more favourable we will do the listing."
Vehvilainen, former CEO of airline Finnair, took over leadership of Cargotec in March. Investors are hoping he can replicate his turnaround of the airline at Cargotec, which has been hit by global economic uncertainty and a glut of vessels ordered before the financial crisis.
The planned spin-off and listing of the MacGregor unit in Singapore is aimed at boosting its profile to attract more clients in Asia and raising money for investments and acquisitions. It also hopes the move would allow the rest of the business to concentrate on equipment for ports and trucks.
Vehvilainen said the company needed better cost control, after analysts criticised it for missteps in pricing and spending. The company's first-quarter operating profit fell to 15 million euros ($19 million) from 37.5 million.
However, he said he had no plans for major strategy changes, adding that many of the measures launched by his predecessor Mikael Makinen, such as moving production to Poland from Finland and Sweden, were the right ones.
"I don't see large scale, big restructuring. We are mostly focused on the right issues," he said. ($1 = 0.7769 euros)
By Terhi Kinnunen; Editing by Patrick Graham and Ritsuko Ando (C) Reuters 2013.