MacGregor settles offshore wind dispute, enabling Cargotec to proceed with sale

The settlement will have a negative impact of approximately €25M (US$27) on MacGregor’s Q2 2024 operating profit. The cost will be reported as items affecting comparability as the costs are related to a one-of-its-kind pilot project and the product is no longer in MacGregor’s sales portfolio. Booking the settlement cost will not impact Cargotec’s outlook on MacGregor’s comparable operating profit for 2024, which was published on 1 February 2024.

Cargotec said MacGregor’s core businesses, merchant and services, are performing well, but described the performance of the company’s offshore business as “unsatisfactory.” It continued, “While the traditional offshore solutions business has performed well and has been profitable, projects related to two new offshore wind solutions have caused losses due to their pilot nature and technical challenges.” MacGregor has therefore decided to stop offering monopile installation solutions and they are no longer part of its sales portfolio.

“Another offshore wind solution, including advanced technology for the servicing of offshore wind turbines, is still a part of MacGregor offering,” said Cargotec, without specifying the nature of the equipment, also noting that “there are approximately 10 smaller loss-making offshore projects to be finalised mainly in 2024” and MacGregor will not commit to any new pilot projects until all of the technical challenges have been resolved.

“These actions are the final stage of the restructuring programme to turn around the offshore business,” said Cargotec, noting offshore wind projects represent less than half of MacGregor’s offshore equipment-related orderbook, which amounted to €87M (Q1/23: 134) at the end of Q1 2024.

Cargotec said its board of directors decided in 2022 that MacGregor will not be part of its portfolio in future, but noted “from a value creation perspective, the timing for divesting the business was not ideal.

“Since then, MacGregor’s performance and market conditions have clearly improved, and with the above-mentioned dispute now being settled, Cargotec has therefore decided to proceed with the sale process for MacGregor,” the company said.

MacGregor president Leif Byström said, “It is an important milestone for us to reach a settlement with the customer related to the monopile installation vessel project.

“Our solution is technically advanced but we were unable to reach an agreement on the way forward. Having the dispute resolved means we are in a stronger position than before to further build on our profitability journey.”