Manish Singh from Aboutships provides readers with a review of maritime tech and services consolidation.
The year 2024 has proven to be an eventful year for mergers and acquisitions in maritime services and technology. The deal log is too long to include here so the following examples are not exhaustive, chronological, or indicative of relative impact but merely demonstrate the frequency and variety of new partnerships (re)shaping the maritime services market map.
Market dynamics
Whereas 2024 was a busy year, most maritime M&A saw weaker bid competition and more measured valuations than initially expected. Reasons appear varied and whereas many are macro in nature such as PE liquidity, geopolitics, high-profile incidents, etc, by and large maritime businesses seeking to transact in 2025 and beyond will need better market education than their teams and investment banks have done in 2024. We also see greater roles for maritime strategics and partnerships between institutional PE investors and blue-chip names in the trade.
However, it is not a case of either/or. We believe bigger strides on maritime decarbonisation and digitalisation will require greater partnerships between maritime strategics and PE investors.
Large maritime signatures that could be among venture backers in the near term, include names such as Maersk, CMA CGM, COSCO Shipping, Eastern Pacific, Hapag-Lloyd, K Line, J Lauritzen, Viasat Maritime, MOL, Nine Realms, MSC, Shell Ventures and a multitudes of regional ship owner/operator groups venturing into venture investments. We are also seeing greater syndication among early-stage business platforms such as Motion Ventures, The Captain’s Table, Flagship Founders (which recently merged with Studio 30 50), and many others. A test of success for such venture backers will be their ability to scale businesses beyond their captive / F&F fleets so that more assets can scale with possible listing or mid-large cap PE.
What is worrying investors
2024 was marked by significant maritime incidents and geopolitical tensions that influenced investor sentiment. The Red Sea crisis, continued supply chain disruptions, and increased focus on cybersecurity risks all shaped deal considerations. These events underscored the importance of operational resilience in target companies. We touch upon these and market cyclicality outlook in pretty much every investment committee discussion we have.
However, by far the most common concern remains the acute shortage of maritime leaders who are proven at scale and have deep industry relations to be able to navigate change that inevitably comes with new partnerships.
Looking ahead to 2025
The pipeline for 2025 appears robust. Several prominent maritime strategics are sitting on large reserves, which they are seeking to deploy not only on fleet revitalisations but also on acquiring services businesses. Similarly, several prominent PEs have now spent significant shoe-leather cost in pursuing maritime processes and becoming more focused in specific consolidation opportunities in the next couple of years. We envisage more early-stage venture-backed companies reaching market adoption in meaningful numbers. Some examples include Orca AI ($23m growth round), Carbon Ridge (recent $9.5m raise) and Harbor Lab (completed $16m Series A)
From our perspective, the deal flows that Aboutships expect to be busiest on through 2025 include:
