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CMA CGM sells stakes in 8 terminals for $815m raising much-needed capital

PortandTerminal.com, March 27, 2020

French shipping company CMA CGM has closed its agreement with China Merchants Port (CMP) with the sale of its stakes in 8 port terminals in an $815m transaction.

MARSEILLE, FRANCE – The CMA CGM Group has closed its agreement with China Merchants Port (CMPort), with the sale of its stakes in 8 port terminals to Terminal Link. 

The Terminal Link joint venture was created in 2013 and is 51% owned by CMA CGM and 49% by CMPort.

The transaction, which was initially announced in December 2019 is valued at $815 million.  

Closing the deal is welcome news for CMA CGM and its investors. The company, which is the world’s fourth-largest shipping company is very highly leveraged and it needs to refinance $1 billion of debt which is coming due next year.

The deal includes the Odessa Terminal in Ukraine, CMA CGM PSA Lion Terminal (CPLT) in Singapore, Kingston Freeport Terminal in Jamaica and Rotterdam World Gateway in the Netherlands.

Additionally, Qingdao Qianwan United Advance Container Terminal in China, Vietnam International Container Terminal, Ho Chi Minh City in Vietnam, Laem Chabang International Terminal in Thailand and Umm Qasr Terminal in Iraq are a part of the deal.

The company added that the sale of the last two terminals will be completed by the end of first-half this year after receiving approval from competent regulatory agencies.

The deal is an all-cash consideration that is valued at more than $150m.

READ: How much financial trouble is CMA CGM in right now? The markets think a lot.

With the divestment, CMA CGM is proceeding with the delivery of its $2.1 billion liquidity plan announced in November 2019. This plan, among others, reduces CMA CGM consolidated debt by more than $1.3 billion by the end of first-half 2020.

Rodolphe Saadé, Chairman and Chief Executive Officer of the CMA CGM Group, said: “Amid the high uncertainty created by the COVID-19 health crisis, the closing of this transaction as previously announced demonstrates the resilience of the CMA CGM Group.”

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