CMA CGM Secures Bank Funding for NOL Takeover
By Aiswarya Lakshmi
Friday, December 4, 2015
CMA CGM has secured the necessary financial backing to proceed with an acquisition of Singapore's Neptune Orient Lines (NOL), Reuters reports, citing two people said to be familiar with the matter.
The French shipping giant is reported to have received “firm commitment” from lenders HSBC, BNP Paribas and JPMorgan to bankroll the deal.
A takeover of NOL would boost the world's third biggest container line's position on transpacific routes at a time when operators are struggling with overcapacity and low freight rates.
The price of a 67% stake in the Singaporean company is set at USD 2.2 billion.
As the talks approach a Dec. 7 deadline, NOL shares are hovering close to their highest level since Feb 2013 and its share price has risen over 40 percent this year, outperforming a double-digit decline in the Singapore benchmark index.
One of the sources said potential synergies were significant and would justify relatively high multiples in the acquisition cost. The other source said the financing would be marketed in Europe and the United States.
CMA CGM, NOL, Temasek and the banks declined to comment.