Offer to acquire Cramo

Cramo, the second largest general equipment rental company in Europe, has announced that it is in “advanced negotiations” with a potential buyer.

The identity of the company making the offer has not been disclosed, but if negotiations are successful, it is expected that an offer of €13.25 per share would be made. That would value the business at €592 million.

Cramo’s shares were trading at around €10 on the morning of 5 November and rose to €12.8 by the end of the day, following the announcement.

If the offer is accepted it would be subject to customary conditions, including required authority approvals. Cramo said there was no certainty regarding the outcome of the negotiations and that it was evaluating its options.

Cramo’s revenues in 2018 were around €630 million, adjusted to exclude the demerged Adapteo modular building bsuiness. EBITDA profits were €104 million.

This news follows Loxam’s acquisition of Cramo’s competitor Ramirent - also based in Finland - earlier this year. That deal made it the largest general rental company in Europe by a large margin.

Although the identity of the potential buyer is unknown, several possibilities suggest themselves. It could be Kiloutou - Loxam’s largest competitor in France which has been expanding internationally - or Ashtead Group in the UK, owner of A-Plant in the UK and Sunbelt Rentals in the USA.

Industry watchers have also been asking when United Rentals, the largest rental company in North America and the world, might make a significant move outside North America.