Energy Cranes Acquires Marine & Mainland
Energy Cranes LLC, the Houston-based offshore crane manufacture, sales, service and rentals arm of Aberdeen-based Energy Cranes International Limited, has acquired the assets of Marine & Mainland Crane Services Inc., creating an enlarged business projecting 2008 revenues in the US market exceeding US$86 million. Energy Cranes International has worldwide revenues before taking account of this deal of US$200 million.
Energy Cranes is not disclosing precise deal valuation but notes that the multi-million dollar acquisition transaction is the largest in the group's history. It doubles Energy Cranes share of the US offshore crane service market.
"Energy Cranes has been demonstrating value and safety gains in crane service to operators and vessel owners since our formation in 2003, while Marine & Mainland, led by Alan Schaefer and Tim O'Neill, has been growing as a similarly strong player in this sector. Some consolidation in the marketplace is essential if contractors are to continue to leverage the safety and performance benefits to clients while developing the service network and skills base the market demands of us," says Energy Cranes chief executive officer, John Jordan.
The acquisition of Marine & Mainland adds 135 people to Energy Cranes' US workforce in a tight skills-sector; no redundancies are planned and additional recruitment is ongoing. Energy Cranes International now employs over 1,500 people worldwide.
The deal also extends Energy Cranes facilities and service network, as Marine and Mainland's facilities at Spencer Road, Houston Texas, Broussard and Slidell (both Louisiana) will all continue to provide client service. Energy Cranes LLC already has crane manufacturing, service or rentals centers in Houston TX, Houma LA, Abbeville LA and Mobile AL.
Alan Schaefer and Tim O'Neill, joint owners of Marine & Mainlined, both join the Energy Cranes US senior management team going forward.
"Both Energy Cranes and Marine & Mainland have been operating at full stretch to meet customer demands from our existing resources," says Alan Schaefer, formerly joint owner of Marine and Mainland and now Executive Vice President with Energy Cranes LLC. "By combining our strengths and our resources, we can generate efficiencies which will enable us to do more whilst at the same time providing a base from which to recruit and develop increased resources for this increasingly demanding market."
Drive for growth
The acquisition of M&M is one of a series of recent Energy Cranes International deals and announcements which have been driven by an ambitious strategic growth plan supported by major shareholder LMS Capital plc and bankers RBS Structured Finance, Aberdeen.
• In July, Energy Cranes announced a deal to acquire Aberdeen Hydraulics and merge the business with Energy Cranes' existing investment in the sector, the hydraulics division of Sparrows Offshore. The new company, Aberdeen Hydraulics Limited, immediately ranks as a leading North Sea hydraulic engineering provider with forty-plus engineers and technicians and two large well-equipped build/test/repair workshops.
• In August, Energy Cranes announced the acquisition of the intellectual property of the former Bucyrus Erie offshore crane manufacturing company, giving Energy Cranes Original Equipment Manufacturer (OEM) parts, service and design authority status over 250 Bucyrus Erie cranes in addition to this same OEM status over in excess of 2,000 offshore cranes manufactured by other brands now in the Energy cranes stable – American Aero, Energy cranes, Houston Systems, Titan Industries and Weatherford Cranes.
• Also in August, Energy Cranes announced plans to establish a project management and delivery base in India to support a long-term contract with ONGC for the refurbishment of 22 cranes in their Mumbai High Asset.
In September 2006, Energy Cranes International Limited rationalized its banking arrangements under a single facility with RBS Structured Finance in Aberdeen with the intention of developing a lasting, supportive and flexible arrangement with one leading banker. The success of this relationship means the subsequent acquisitions of Aberdeen Hydraulics Services, Bucyrus Erie and Marine & Mainland, together with investments in plant and physical resources, have been able to be financed by building this facility with RBS against a background of Energy Cranes' continuing growth in both sales and profitability.
Euan Leask and Michael Willett led the recent transaction for RBS. Euan Leask, Head of Structured Finance at RBS in Aberdeen comments;
"Energy Cranes have built their business model through selective acquisitions and our funding support has been designed to provide the company with the resources to capitalize on opportunities within their marketplace such as the acquisition of Marine & Mainland. We enjoy a good relationship with Energy Cranes and look forward to working with them in the coming years."
Energy Cranes continues to see attractive prospects for development as a focused lifting and mechanical handling contractor.
"The energy industry will have to work harder, to work equipment harder, and yet also to work ever more safely and cost effectively if we are to meet the needs of an energy-hungry world," says Energy Cranes chief executive officer, John Jordan.
"Mechanical handling – not just cranes, but safer mechanized handling systems for drilling – will continue to be pivotal to delivery of the industry's objectives. Our goal is to secure Energy Cranes future as the outstanding provider of safe and efficient mechanical handling systems and services to this industry."