Keppel and Boskalis Divest of Asian JV Tug Operations in Consolidation
Singapore’s Keppel Offshore & Marine and the Netherlands’ Boskalis Westminster announced plans to divest their Asian tug and tow operation. The transaction, valued at approximately $198 million, comes as a consolidation in the towing business with Italy’s Rimorchiatori Mediterranei agreeing to buy out the two partners in Keppel Smit Towage and its joint venture in Maju Maritime.
Started in 1991 as a joint venture between Keppel Shipyard and Smith Singapore, which was a division of Boskalis, the towage company grew to become a leader in Asia. The company is today one of the largest and leading harbor tug service companies in Southeast Asia with a fleet of 58 tugs in Singapore and its joint venture in Malaysia. In Singapore alone, the company operates 24 tugs for harbor operations. They offer harbor and offshore support services, ship-to-ship operations, and coastal towing.
The decision to sell the joint venture company comes as both Keppel and Boskalis have been seeking to reformulate their operations. Keppel previously announced plans to streamline and divest non-core assets to focus on what it calls “sustainable urbanization.” In January 2021, Keppel said it planned to end its rig construction and repair business from its money-losing shipyard operations. Keppel also explored merging the offshore and marine operations with Sembcorp Marine. The towage operation is reported to be profitable but outside the core strategy.
Boskalis announced in 2019 that it planned to divest its worldwide harbor towage activities. Boskalis sold its stakes in Saam Smit Towage, which operated primarily in Central and South America, and Kotug Smith Towage, which operated in Northern Europe, in 2019.
Rimorchiatori Mediterranei, which has agreed to acquire the operations in Asia, is a subsidiary of Rimorchiatori Riuniti Group, a maritime service provider headquartered in Genoa, Italy. Established in 1922, Rimorchiatori Mediterranei operates a fleet of more than 100 modern vessels in more than 20 major ports.
The sale agreement is subject to approval from the regulatory agencies in Singapore. The transaction is expected to close in the first half of 2022.