The merger between Svitzer's salvage business and US-based Crowley Maritime's Titan Salvage - most famous for raising wrecked cruise liner Costa Concordia - will create the biggest player in the field.
Coming Ardent CEO Peter Pietka, who has till now served as head of Svitzer Salvage, explains that the new company will cover approximately one third of the market for emergency response, which includes services aimed at preventing accidents from happening as well as preparing carriers for accidents that are bound to happen. In wreck removal, which includes jobs such as towing wrecks like Costa Concordia or raising warships from the ocean floor, the two companies combined will cover around one fourth of the global market.
Two major players
"We expect that we'll become the biggest company in the global salvage industry, though this ultimately depends on the demand in the market. We are already, individually, two major players in this field, and in terms of historical figures we'll become the leading company," Peter Pietka tells ShippingWatch in a comment on the merger.
The closest competitor is Dutch Smit, but according to ShippingWatch's sources the two companies behind Ardent have had a higher revenue in the past 24 months.
About the motivation for the new company, which will be based in Houston, Texas, he says that the merger represents a defensive as well as offensive move.
Salvage market under pressure
The salvage market has been under pressure in recent years and is currently in the midst of major changes, which can be be illustrated somewhat efficiently with the raising of Costa Concordia - a colossal job, but also a job seldom seen in the market. And the market generally looks like this, as there are fewer salvage jobs to compete for, though the jobs that do emerge are very big.
"Emergency response has always been very cyclical, but now it's become super-cyclical. Both companies have skilled employees who will join Ardent, while also allowing us to improve operational efficiency," explains Pietka.
New organization with 150 employees
In terms of employees, this means that 25 percent of the current employees at the two companies' salvage divisions will be laid off, so that the new merged company will have an organization of 150 people.
There are already indications that the merger could be expanded in one form or another, and that it might even happen before long. Peter Pietka's only comment on this is that he "confirms that there are plans for further initiatives and that the new company is generally very focused on collaborating."
The announcement has been noticed among the many shipping and offshore professionals gathered in Singapore this week. This is partly due to the fact that the move concerns the largest US-based shipping group, Crowley, which is 100 percent owned by Tom Crowley, merging with a part of a carrier that has the Maersk family as its dominant owner and which is headed by Robert Uggla as CEO.
However, it has also been noticed - and as a surprise to some observers - that Robert Uggla, who represents the fifth generation of the Maersk family, is not a member of the new company's board of directors, where Svitzer is represented by two other leading executives, including CFO Knud Winkler.
Crowley's Todd Bush is chairman, and Tom Crowley is also a member of the new board of directors.
Robert Uggla will still be overall responsible for Svitzer as CEO going forward, including the towage division, which represents biggest part by far of the company's business. Salvage accounts for around five percent of Svitzer's combined revenue.
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Market Research Analyst – Ultragas
Data Engineer - Ultrabulk
