Icelandic shipping company Eimskip has entered into an agreement to aquire Norwegian shipping and logistics company Nor Lines.
Eimskip described Nor Lines as a strategic fit within Eimskip’s core market and the overall transaction as asset-light. Eimskip’s says it will restructure the company in order to improve services and profitability by aligning it with Eimskip’s current operations in Norway.
The estimated annual turnover of Nor Lines, which has about 200 employees, amounts to approximately EUR 110 million.
Nor Lines currently operates a fleet consisting of seven cargo vessels that operate three different trade lanes in and out of Norway. As part of the restructuring, Eimskip will take over operation of five vessels, including one owned and four chartered.
Nor Lines also includes an extensive shore-based operation consisting of a network of 60 terminals along the Norwegian coast, providing warehouse operations and freight forwarding services. Out of the 60 terminals, the company operates 14 while the remaining 46 are operated by agents. Nor Lines’ service network also consists of 450 trucks owned and operated by third parties. In addition Nor Lines is selling cargo capacity on 11 Hurtigruten vessels operating on Norway’s western and northern coast.
“The acquisition of Nor Lines is a large step in widening the service scope and strengthening the current services of Eimskip in Norway,” said Gylfi Sigfússon, President and CEO of Eimskip. “Eimskip is currently operating seven side-loaded reefer vessels in Norway which serve between Norway, the Netherlands and the UK, but the acquisition will increase our efficiency since our sailing system will range over to the Baltic Sea and Germany. We look forward to working with the employees of Nor Lines on improving the efficiency of the two companies. The transaction is a part of Eimskip’s accretive strategy of external growth and will further strengthen the company’s liner services in Norway.”
Completion of the transaction is subject to approval by the Norwegian Competition Authority.
According to Eimskip the approximate purchase price is just EUR 15 million but may increase or decrease based on the financial performance of Nor Lines in 2016. The acquisition is financed with cash.