NOL Confirms $2.4 Billion Cash Offer from CMA CGA

CMA CGM says the acquisition of NOL will "cement its position among the global leaders in the container shipping industry."

Neptune Orient Lines (NOL) Monday confirmed a S$3.4 billion ($2.4 billion) cash offer from France's CMA CGM S.A. (CMA CGM) to buy the Singapore-based box shipper.

As Ship & Bunker reported earlier today, the offer of S$1.30 ($0.93) per share - a 6.1 percent premium over Friday's close price - was widely expected following a halt in trading of NOL's shares this morning.

"We are supportive of this transaction as it presents NOL with an opportunity to join a leading player with an extensive global presence and solid operational record," said Tan Chong Lee, head of portfolio management at NOL's 67 percent majority shareholder Temasek Holdings (Private) Limited (Temasek).

"The combination of NOL and CMA CGM will create a leading shipping company that delivers reliable and efficient service to its customers."

The offer still needs to fulfil a number of preconditions, most notably approval of anti-trust authorities.

"The Acquisition will enable the Offeror to cement its position among the global leaders in the container shipping industry. It will create a new global force in shipping, with a capacity of 2,399,000 TEUs, a market share of approximately 11.5%, a fleet of 563 vessels and a combined turnover of approximately USD22 billion," the offer read.

"The combination of CMA CGM and the "NOL Group" (being the Company and its subsidiaries) will create a powerful and dynamic new entity; and the combined group's (the "Group") clients will have access to an enlarged and well balanced shipping coverage across the strategic trades of global commerce, and to an extended range of products and services."

Singapore also looks set to play a significant role in CMA CGM's future plays.

"CMA CGM aims to expand and strengthen its presence in Singapore, benefitting from the Company's historic legacy and reinforcing Singapore's leadership in the maritime and shipping sector as part of the enlarged Group's strategy in Asia," the offer said.

"CMA CGM will also contribute to reinforce Singapore as a center of excellence in the field of maritime activities as the Offeror plans to use Singapore as a key hub in Asia and to establish its regional head office here."