An ear to the ground

09 Oct 2017

COMMENT: A major news item during an uncharacteristically busy August was the announcement by A.P. Moller-Maersk that it would be de-accessioning its oil production business, in a deal worth $7.5bn including shares and debt, writes Barry Parker.

Instead, focus at the Danish giant will be on Maersk Line, its liner shipping business, along with other holdings tied to logistics. Its drilling rigs and tankers are the next in line to be sold.

Most of the news blasted at port planners through the trade press concerns “consolidation”, ie actual mergers, and the shifting palette of who is in which alliance. But the implications of this strategy shift at A.P. Moller-Maersk (and others) regarding their core businesses is also worth a look.

Previously, pundits and analysts were espousing “diversification”, meaning that the liner behemoths might benefit from owning a “portfolio” of business. But, boffins’ views aside, the strategy du jour in Copenhagen is one of streamlining and leveraging logistics synergies. Presumably competitors of Maersk will follow the steps of a perceived thought leader - if they have not done so already.

So for port planners around the US East Coast and any other place where the big carriers’ vessels are calling now is the time to help the big guys identify some of the synergies. News flashes about consolidation and how the roster of players in a particular alliance is to shift should not be ignored. Port planners who are close to the docks might pick up on some small synergy (however defined) with a business benefit, and could then make it known to the carriers/ alliances.

With liner shipping now being the core business for the customers of some ports, or its tenants, where there is a landlord structure, sensible ideas may now receive attention and scrutiny, even if they are not the product of expensive consultants guiding these carriers.

Contrast this with a diversified company, where divisions in different businesses within a large portfolio type corporation are competing with each other on a big scale. They may not have the wherewithal to consider the numerous tweaks that a local planner on the waterfront might be able to uncover.

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