04.08.2008

Manitowoc exits shipbuilding

Manitowoc has agreed to sell its entire marine business to Fincantieri Marine, the US division of Fincantieri - Cantieri Navali Italiani with Lockheed Martin taking a minority stake in the proposed acquisition.

The all cash deal is valued at $120 million and should close at the end of 2008, subject to customary clearances for transactions of this type including U.S. antitrust and certain U.S. security agencies.

Manitowoc Marine Group includes shipbuilding, ship repair, and ship conversion and operates from facilities in Sturgeon Bay, Wisconsin; Marinette, Wisconsin; and Cleveland, Ohio. It had revenues in 2007 of $321 million and has a workforce of 1,587

Glen E. Tellock, Manitowoc's president and chief executive officer, said: "As our legacy business, Marine led the way in establishing Manitowoc's tradition of integrity, commitment to stakeholders, and passion for excellence -- the values that have driven the success for all three of our segments. In addition, this transaction expands the opportunities for Manitowoc Marine to continue its industry leadership in the future. More importantly, it will allow it to become part of a growing, global organization that is exclusively focused on commercial and military shipbuilding."

"This transaction will allow Manitowoc to focus its financial assets and managerial resources on the growth of its increasingly global crane and foodservice businesses. It also will allow us to invest the proceeds from the sale to generate additional shareholder value," Tellock added.

Vertikal Comment

This is an obvious move for Manitowoc following its acquisition of Enodis, which will boost its food business and most likely require further investments next year as it attempts to repeat its success with cranes in the food equipment market.

The marine business most likely had some emotional attachment for the company, but holding onto it made little sense given the better prospects in food and cranes.

The deal is likely to benefit the employees who will have a dedicated marine owner, the buyer and of course Manitowoc in that it cuts out a distraction and will help fund its two big international businesses.

A win win win deal