'Cool' Reefer Merger On Course
August 23, 2005
NYK subsidiary NYK Reefers and LauritzenCool have now received clearance from the European Commission to merge their reefer activities. The new company, NYKLauritzenCool AB, owned on a 50:50 basis by NYK Reefers and J. Lauritzen, will become one of the world's largest reefer shipping companies, operating more than 70 specialized reefer vessels of various sizes, in all major reefer trades.
Negotiations about forming the joint company have been going on since the beginning of this year when J. Lauritzen A/S and NYK Reefers agreed on a memorandum of understanding concerning a merger of their reefer activities, following a strategic cooperation and vessel-sharing agreement launched in January 2004.
A Perfect MatchDiscussions have been nourished by several elements, one of which is the fact that the two companies' activities match each other like pieces in a jigsaw puzzle.
"If you draw our respective trades and lines on a map, you'll find that together they cover all major growing and consuming areas and match perfectly," says Torben Janholt, chief executive officer (CEO) of J. Lauritzen. Hiroshi Yamafuji, CEO of NYK Reefers, adds, "This goes for our respective strengths in business focus and organization as well."
Janholt and Yamafuji both emphasize that the creation of the new company is based on the mutually shared ambition to increase and improve customer services and to meet the challenges of the future reefer market. Financially, this will now be made possible through the combined economic strength of the two owners.
Few Organizational ChangesNYKLauritzenCool AB will be based in Stockholm and occupy LauritzenCool AB's former head office. NYK Reefers office in London will become a branch office and continue to service customers.
Mats Jansson, CEO of LauritzenCool, does not foresee any major organizational changes but rather minor adjustments as the merger progresses. "Our main task for the immediate future is to get our merged operations up and running at an optimum," says Jansson. "Our client contact staff will remain the same and gradually our clients will experience improvements in our services," Jansson affirms. "Local and regional business relations and responsibilities will remain decentralized to our offices in major markets around the world."
Fleet of More Than 70 ReefersFollowing the merger, NYK Reefers and LauritzenCool will join their respective fleets and the new company will hence operate more than 70 specialized reefers of different classes between 300,000 ft3 and 760,000 ft3, most of vessels equipped with high container capacities and modern treatment facilities such as controlled atmospheres.
Integrated LogisticsThe deregulation of many exporting markets - resulting in a large number of smaller growers and exporters - and conglomeration on the receiving side have put new, strong demands on reefer companies to extend their services into integrated logistics and information handling.
Consequently, NYKLauritzenCool will continue to expand the activities of its subsidiary, LCL, which provides integrated logistics solutions for the world's perishable trades - providing local solutions with a global reach.
Reefer Business in TransitionThe reefer business is undergoing an important transition. After a period of poor profitability, business is now more optimistic. At the same time, consumption is going up and new markets are being added, and clients, especially at the buying end of the transport chain, are raising their demands for more advanced logistic services such as IT support, multidestinations, just-in-time, etc. This calls for new thinking and unconventional solutions.
New ConceptsIt is the new company's intention to actively seek innovative solutions to old and new problems and to develop new logistics and transport concepts." There is a fresh climate of optimism and belief in the future of this business. Everyone is aware of the fact that contemporary ideas are needed, but they can only be realized by reefer companies with financial and organizational strength such as NYK LauritzenCool," Jansson concludes.
Board of DirectorsMr. Hiroshi Yamafuji, CEO, NYK Reefers Ltd.
Mr. Torben Janholt, president and CEO, J. Lauritzen A/S
Mrs. Birgit Aagaard-Svendsen, executive vice-president and CFO, J. Lauritzen A/S
Mr. Masahiro Samitsu, general manager, Bulk and Energy Atlantic Group, NYK Line
Mrs. Alison Sjotrom, employee representative, NYKLauritzenCool
Mr. Goan Timen, employee representative, NYKLauritzenCool
All addresses and contact details will, for the time being, remain the same as before.
For further information, please contact:
Mr. Hiroshi Yamafuji: +44 20 7925 8456
Mr. Torben Janholt: +45 21 63 92 32
Mr. Mats Jansson: +46 8 753 9000