Credit: Kongsberg Gruppen
Rolls-Royce has signed an agreement to sell its Commercial Marine business, including its Ship Intelligence activities, to KONGSBERG for an enterprise value of US$ 662 million (£500m), a significant deal for establishing automation in the maritime industry.
As part of its strategy to deliver high technology systems to clients within many different sectors, KONGSBERG is exploring how it can make remotely operated ships a reality — a strategy that recently meant it joined forces with another Norwegian firm, maritime industry group Wilhelmsen, to create a new autonomous vessel company called Massterly.
The Rolls-Royce business has rapidly developed technologies to enable remote and autonomous operation of commercial vessels, which will support KONGSBERG's goal to build the world’s first fully electric and autonomous containership, the Yara Birkeland, by 2020.
KONGSBERG's projects will also benefit from Rolls-Royce’s own technological breakthroughs, such as its Intelligent Awareness, a system that uses multiple sensors with intelligent software to mitigate against navigational safety risks.
Watch KONGSBERG's video about its agreement with Rolls-Royce Commercial Marine:
The purchase will advance KONGSBERG's operations as the work Rolls-Royce has undertaken with other key players in the industry includes the likes of insurance firm AXA Corporate Solutions, which is exploring how its risk analytics capabilities could support current and future vessels.
The sale follows a strategic review by Rolls-Royce of its Commercial Marine operations announced in January 2018, and will include propulsion, deck machinery, a service network spanning more than 30 countries and ship design capability, which to date has seen around 1,000 ships of Rolls-Royce design delivered to offshore, cargo, passenger and fishing vessel customers worldwide.
Commercial Marine has approximately 3,600 employees, with the majority based in the Nordic region.
With the transaction approved by the boards of both Rolls-Royce and KONGSBERG, the companies expect the transaction to close in Q1 2019, subject to clearance from the regulatory authorities.
Kongsberg Gruppen: “Autonomous maritime technology will change the world.”
Warren East, Chief Executive of Rolls-Royce, said: “This transaction builds on the actions we have taken over the last two years to simplify our business.
“The sale of our Commercial Marine business will enable us to focus on our three core businesses and on meeting the vital power needs of our customers.”
Geir Håøy, Chief Executive and President of KONGSBERG, said: “The acquisition of Rolls-Royce Commercial Marine makes us a more complete supplier to the maritime industry.
“The maritime industry is becoming increasingly globalized and is undergoing considerable technological and market-driven changes.
“With this acquisition, we will strengthen our strategic position with shipowners, shipyards and other customers and partners.”
Learn more about the Yara Birkeland:
Mikael Makinen, Rolls-Royce President, Commercial Marine, added: “Today marks the start of a new horizon for our Commercial Marine business.
“This deal comes at a time when the maritime industry is at the dawn of a new and exciting era where digital and electrical technologies will transform shipping.
“Rolls-Royce has been responsible for leading many of those technological advancements, and with a combination of great people, market-leading technology and a desire by KONGSBERG to take this business to the next level, I am sure that this business will prosper in the years to come.
“We will now work closely with KONGSBERG as we go through the transition in the months ahead.
“I would like to pay tribute to the 3,600 Commercial Marine employees who have maintained absolute focus on their day jobs, winning business and maintaining the levels of support our customers expect.”