CMA CGM Compromising to Get EU’s Nod on NOL Takeover
- Business & Finance
French liner giant CMA CGM submitted on Thursday a filing to the European Commission that is said to contain concessions expected to ensure the antitrust approval of its USD 2.4 billion takeover of Singaporean counterpart Neptune Orient Lines, data on the European Commission website shows.
Under the proposal, the French company is expected to withdraw NOL’s APL from competing shipping alliances, Reuters reports citing people familiar with the matter.
APL is currently a member of the G6 Alliance, but a notice of termination of APL’s participation in the G6 Alliance is to be issued immediately upon closing of the acquisition.
CMA CGM in February revealed its plans to form a new mega alliance with the Chinese shipping company China COSCO, which was linked to APL being pulled out of the G6 Alliance after the approval from antitrust bodies, expected by mid-2016.
The French company has reportedly told the European Commission it would remove Neptune Orient’s APL container unit from the G6 Alliance “to allay competition concerns over the tie-up” and avoid anti-competitive links to CMA CGM’s new alliance being formed with United Arab Shipping and China Shipping Container Lines.
As a result of the bid, CMA CGM is given an extended deadline for review by the EU, now due until April 29th instead of April 15th, the filling shows.
On 8 March 2016, CMA CGM notified to the Commission a proposed acquisition of NOL, which is currently controlled by Temasek Holdings and its affiliates.
With a fleet of 470 vessels, the CMA CGM Group operates 170 shipping lines on the main commercial trade routes, whereas NOL, with a fleet of 94 vessels runs through its brand American President Lines (APL) more than 80 weekly services at ports in over 50 countries worldwide.
World Maritime News Staff