FRENCH SHIPPER CMA CGM, SINGAPORE RIVAL TEAM UP TO WEATHER BUSINESS STORM

Monday, December 07, 2015
France's CMA CGM, the world's third-largest maritime shipping company, announced it will launch a tender offer to buy all outstanding shares of Singaporean shipping company Neptune Orient Lines in a deal that values the company at 3.4 billion Singapore dollars ($2.43 billion).

CMA CGM will offer S$1.30 per share. The offer price is 49% higher than NOL's share price on July 16, the last trading day before media reports surfaced on a potential sale, and 6% higher than the closing price on Dec. 4.

Singaporean sovereign wealth fund shareholder Temasek Holdings and its affiliates, which together own 67% of NOL, have agreed to sell their entire stake, according to a joint press release by CMA CGM and NOL. The takeover bid is expected to take place around mid-2016, once certain conditions, including approval from antitrust committees, are met.

The deal will increase CMA CGM's total fleet from 469 to 563 vessels, placing CMA CGM in the top position for transpacific shipment routes. After the transaction, CMA CGM will have 11.5% of the world's maritime shipping capacity, up from 8.8% before the transaction. CMA CGM plans to establish a regional head office in Singapore, but will operate NOL's existing fleet under the current APL brand.
 
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