Cadeler and Eneti to Merge into Leader in Wind Installation
Cadeler and Eneti, two emerging wind turbine and foundation installation companies, announced plans to merge into a powerhouse company that will have global reach and could control as much as a quarter of the market. According to the companies, the merger responds to the emerging trends in the offshore wind sector where customers have increasingly complex projects as the size of wind turbines grows and the sites become more challenging.
“The combination will represent a significant step up in our ability to meet the increased demand globally for projects with larger scopes and project sizes in service of the much-needed green transition,” says Mikkel Gleerup, who is being credited with engineering the combination and will continue as CEO of the combined company which will be known as Cadeler. “We will provide our customers with the largest and most diverse fleet in the industry.”
Terms of the stock-for-stock combination call for Eneti to merge into Cadeler at a rate of just over 3.4 shares to 1 creating a combined company with an estimated market value above $1.3 billion traded on the New York and Oslo stock exchanges. Cadeler’s investors will hold 60 percent of the combined company while Eneti’s shareholders will represent approximately 40 percent if all the shares are tendered. Cadeler intends to conduct a “squeeze-out merger” once it has 85 percent of Eneti’s shares.
Cadeler traces its history back 15 years formed as a combination of shipping and engineering for the offshore sector. Today, its largest investors are BW and Swire-Pacific. Eneti was the rebirth of the former dry bulk operator Scorpio which just two years ago announced it would enter the business divesting of its bulkers and later acquired Seajacks to accelerate the transition into the offshore sector. The deal brings together two well-known leaders in the shipping industry with Andreas Sohmen-Pao continuing as Chairman of Cadeler and Emanuele Lauro transitioning from CEO of Eneti to Vice Chairman of the combined company.
Sohmen-Pao highlights the strategic nature of the combination which the companies said have complementary fleets and will gain a global presence, and the ability to operate more efficiently, and target larger projects. Lauro cites the value in the combination and changing demands of the industry.
Combined they report they will have the largest and most diverse fleet of turbine and foundation installation vessels. Cadeler has two wind turbine installation vessels operating and two more on order due for delivery in the third quarter of 2024 and the second quarter of 2025. They also have two wind foundation vessels scheduled for delivery in the fourth quarter of 2025 and the third quarter of 2026. Eneti currently has five vessels in operation, although they plan to divest three as part of the transaction. Eneti is also building two wind turbine installation vessels due for delivery in the fourth quarter of 2024 and the second quarter of 2025.
They are forecasting more than $100 million in synergy including nearly $50 million in operations as well as more than $50 million through improved utilization of the fleet.
The combination is subject to the customary closing conditions including approval by both groups of shareholders. Cadeler’s two largest shareholders, which combined hold approximately 45 percent of the shares, have agreed to vote in favor while Eneti’s largest holder and management, holding 36 percent, have entered into tender agreements. The transaction is expected to close in the fourth quarter of 2023.