A joint venture operating a fleet of tugs in Europe is about to be sold to a rival, reducing competition in the region’s ports.
Kotug International and Royal Boskalis Westminster have signed a letter of intent relating to the sale of their 50/50 joint venture, Kotug Smit Towage, to Boluda Group.
This values Kotug Smit Towage at €300M (US$340M). Boskalis said it expects to receive around €90M (US$102M) for its 50% equity stake in the joint venture. Kotug did not specify what it expects to receive from the sale, but a spokesman said it should be a similar amount.
Kotug chief executive Ard-Jan Kooren said the cash from this sale will enable the group to expand in other markets. “I am confident that this development will unlock new opportunities to further strengthen our growth and allow us to offer operational excellence and innovation to our customers,” he said.
Kotug Smit Towage was formed in 2016, when it provided tug services in 11 ports in the Netherlands, Belgium, Germany and the UK. Since then, the joint venture has expanded its presence into new ports and realised efficiency savings.
Both Boskalis and Kotug will exit the European towage sector following this sale to Boluda, which operates a fleet of more than 230 vessels in Spain and France, plus in Africa, the Indian Ocean and Latin America.
This agreement is subject to customary conditions including due diligence and approvals from regulatory agencies in the respective countries involved. The transaction is expected to close in H2 2019.
Kotug Smit Towage has access to 26 tugs with bollard pulls ranging 70-100 tonnes, 24 tugboats with bollard pulls of 60-70 tonnes and 18 vessels that have 36-60 tonnes of bollard pull. Its fleet includes five tugs that have hybrid propulsion systems. Kotug Smit Towage received tug newbuildings in 2018 as part of its ongoing fleet investments.
This is the second sale announced by Boskalis this year as it is working to sell its equity stake in the SAAM Smit Towage joint venture, which operates in Latin America and Canada, to Chile-headquartered SAAM for US$210M.
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