Sale of port assets to fund company takeover
A major shipping group plans to part-fund a company takeover through a sale of port assets.
French shipping giant CMA CGM said it planned to raise US$2bn to help finance its takeover of France-headquartered CEVA Logistics, with half of this sum made from selling stakes in 10 port terminals for US$968m to global container terminal operator Terminal Link, CMA CGM’s joint venture with China Merchants Port Holdings Co., reported Reuters.
The Terminal Link deal, expected to be finalised in the spring, would be partly financed by a US$468m capital increase by the joint venture and by a loan from China Merchants that would be converted into another capital increase after eight years, CMA CGM said in a quarterly results statement.
No ownership change
The ownership of Terminal Link, in which CMA CGM holds a 51% stake and China Merchants has 49%, would not change, CMA CGM’s chief financial officer, Michel Sirat, told reporters.
CMA CGM also plans to raise US$860m from the sale and leaseback of some ships, US$93m from selling a logistics platform in India and another US$100m from a securitisation programme relating to customer receivables at CEVA.
“We have a lot of assets and we use them fully,” Mr Sirat told reporters, adding no other divestments were planned in the short term.
CMA CGM said it was pushing back some of Switzerland-based CEVA’s financial targets by two or three years, partly because of a slowdown in some industries.
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