CMA CGM Moves on Conditional General Offer for NOL Acquisition

by Ship & Bunker News Team
Monday June 6, 2016

CMA CGM S.A. (CMA CGM) Monday announced that it has launched an all-cash voluntary conditional general offer to acquire all outstanding shares of Singapore-based Neptune Orient Lines Limited (NOL).

As Ship & Bunker reported last week, CMA CGM announced its "firm intention" to put the offer forward at a price of S$1.30 ($0.94) per NOL share in cash.

CMA CGM notes that it currently owns 10.5 percent of all NOL shares, while Temasek Holdings (Private) Limited and its affiliates currently own 66.78 percent, with the French shipping giant intending to delist and privatise NOL through through the deal.

The offer is said to provide NOL shareholders with an opportunity to benefit from their investment in NOL at a 49 percent premium to NOL's unaffected share price on July 16 2015, as well as a 33 percent premium to NOL's 3-month volume-weighted average share price prior to July 16 2015.

CMA CGM says the acquisition would "enhance competitiveness and deliver sustainable performance," enabling the company to "reinforce its position as a leader in the container shipping industry, with a capacity of approximately 2.35 million TEUs, a market share of approximately 11.7 percent, a fleet of approximately 540 vessels and a combined annual turnover of approximately $21 billion."

Maybank Kim Eng Securities Pte. Ltd. (MKES) is said to have been appointed as the independent financial adviser (IFA) in order to advise the directors of NOL on the pending deal.

NOL non-executive independent Chairman, Kwa Chong Seng, commenting on the independent directors' assessment of the deal, says that they have put forth a recommendation to NOL shareholders to accept the offer, "unless NOL shareholders are able to obtain a price higher than the Offer Price on the open market, taking into account all brokerage commissions or transaction costs in connection with open market transactions."

CMA CGM notes that Acceptances of the Offer must be received by July 4, 2016 at 5.30 p.m. Singapore local time, unless a later deadline is announced by or on behalf of CMA CGM.

Earlier this month, CMA CGM received confirmation that its pending acquisition of NOL had been cleared by China, having already received European backing for the deal in April.