Reports: CMA CGM Seeking Funds for NOL Takeover

by Ship & Bunker News Team
Wednesday December 2, 2015

CMA CGM S.A. (CMA CGM) is in talks with lenders, including BNP Paribas SA (BNP), HSBC Holdings Plc (HSBC), and JPMorgan Chase & Co. (JPMorgan), to fund a potential takeover bid of Singapore-based Neptune Orient Lines (NOL), Bloomberg Business reports, citing people said to have knowledge with the matter.

The financing talks are said to be a part of Singapore's requirement for CMA CGM to demonstrate it has sufficient financial resources to make a definitive bid for NOL, which has a market value of S$3.1 billion ($2.2 billion).

"It may not be a done deal yet, but CMA needs to demonstrate they have the financing capability to go ahead," said Soo Hai Lim, Director of Asian Equities at Baring Asset Management (Asia) Ltd. in Hong Kong.

"They should be able to get some synergies from this acquisition. Consolidation should be good for the industry."

As Ship & Bunker previously reported, NOL has given CMA CGM until December 7 to "negotiate the definitive agreements to be entered in relation to the offer."

On Monday, it was reported that if acquisition talks between NOL and CMA CGM fail to progress, Maersk Line says negotiations with the Singaporean company could resume.

In November, Drewry Shipping Consultants Limited (Drewry) said that an acquisition by A.P. Moeller-Maersk A/S (Maersk) or CMA CGM would likely not be a financially advantageous move for either company, but noted that of the two, "CMA CGM is the better fit."

Ship & Bunker News Team
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