MacGregor Gets Chinese Clearance for TTS Acquisition
MacGregor, part of Cargotec, has received a clearance decision from the Chinese competition regulator, SAMR, for the company’s acquisition of the marine and offshore businesses of TTS Group ASA. Based on revised estimates, potential cost synergies are estimated to be around EUR 25-30 million on annual level.
MacGregor now has all the regulatory approvals needed to be able to complete the transaction, which was announced on 8 February 2018. Closing of the transaction is expected to take place July 31, 2019. MacGregor previously announced approval from the German regulator on November 6, 2018 and approval from the South Korean authority on December 27, 2018.
The Chinese competition authority approval includes temporary requirements relating to the terms and conditions of certain new equipment business undertaken in China, and the need to hold certain new equipment businesses separately for a period of two years.
Based on revised estimates, potential cost synergies are estimated to be around EUR 25-30 million on annual level and are expected to be reached within three years from closing. In the stock exchange release on 8 February 2018, the potential cost synergies were estimated to be around EUR 30-35 million on annual level and were expected to be reached within three years from closing. The revised cost synergy estimate is lower than the earlier estimate, as the closing was delayed from the original target and both parties have already executed some of the cost savings.
Cargotec reiterates its outlook published on February 8, 2019 and expects its comparable operating profit for 2019 to improve from 2018 (EUR 242.1 million).
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