“To answer that you only have to look at what we’ve achieved, he says. “People ask how we are going to do it since it means doubling our size. But look at where we are, we have built up a business from scratch and already gone from €12m to €525m in ten years.”
Certainly it’s been a story of snakes and ladders, with some dramatic slides and some equally dramatic turnarounds. To start with, Mr Neteland explains: “TTS went public in 1995 as a shipyard equipment company, but by 1996 they were losing money with the shipyards, so I came in with restructuring in mind. So we closed that side of the business and repositioned the company as manufacturing onboard lifting gear.”
He adds: “I’d had a diverse experience, not maritime by any means, but the thing they all had in common was that they needed help.”
“What we have done in TTS is build up a global structure from scratch, but at least now there’s something to build out from. It’s actually a significantly easier job to get to that €1bn mark than the job we faced in 1999.”
Given the new focus, the company shot up in profile and value, concentrating on growing the business by looking at both where the lifting equipment could find new markets and by acquisitions. “It’s about half and half”, says Mr Neteland. “One side is organic growth, the other side gives you different capabilities, but more importantly, the profit margin goes up significantly if you are a large, international player.”
But it was an acquisition that nearly undermined the whole project. “Not the acquisition itself, but the way one of them was financed.”
He explains: “We were hit hard by the crisis but two things made it difficult. One was the cancelled orders coming to €250m. The first six months of 2009 was critical, but we sorted it out. The other, bigger problem was an acquisition that had been financed on the bond market, something that investors wanted to do at the time. When the market stopped dead, we didn’t have anything to back up with. Unlike others, we hadn’t got an order book in place and the market was zero for around 18 months.”
“It’s simply not something that I would do again, finance an acquisition like this. You need to have plenty in the bank.” The acquisition was justified, he adds, as last year the company sold it, making almost half a billion NOK on the deal.
He says he has learned other things too, including “finding local partnerships”. “We went into Japan in 2000 but got badly burnt by the experience. It wasn’t well enough thought through before we started. I think I found out then that the best way to succeed in foreign markets, especially in China, is to become local. By which I mean only Chinese people in a Chinese factory, with minimal non-Chinese input. This means you make the most of local supply networks.”
