01.12.2017

Cramo and Rami consider future of Fortrent

Ramirent and Cramo are exploring strategic options for their 50/50 Russian joint venture company Fortrent that could include the sale of the company.

Fortrent, which operates in both Russia and the Ukraine and had revenues in 2016 of €29.2 million, with an operating profit of €3.2 million. It was officially established in March 2013, following an agreement concluded by Cramo and Ramirent in October 2012 to merge their Russian based subsidiaries. At that time the combined business had revenues of €52 million, with 22 locations and 400 employees. See Ramirent and Cramo to merge in Russia

Based in St Petersburg, Fortrent now operates in five of Russia’s federal districts - Central, North Western, Southern, Volga and the Urals, with 25 rental offices or yards. And from three locations in Ukraine - Kiev, Odessa and Dnepropetrovsk.
The company statement says that as the strategic review is at its early stages, no further details can be disclosed at this time.

Vertikal Comment

Both shareholders are going through major reorganisations and repositioning themselves a little, rather than trying to offer all things to all customers in every market they operate in. One has to wonder whether the Russian market has proved to be too challenging in the changing economic climate, or whether they simply feel that cashing in their investment they can invest management time and funds in other markets they operate in where they are facing a strong push from companies like Kiloutou, Loxam, and TVH etc…

As we said yesterday perhaps the two could look at swapping some of their operations? Rami could give Cramo its Temporary Space division and take Cramo’s half of Fortrent. All a bit simplistic? Of course it is. One wonders if the French or Belgian rental groups mentioned above have the stomach for the Russian market, or if the business will go to one of the up and coming local companies?

Interesting times. Watch this space