From CPH Post
Container company Maersk Sealand is offering DKK 17 billion for Dutch P&O Nedlloyd. The merger would create the largest container line in history
Shipping giant A.P. Moeller-Maersk offers DKK 17 billion in cash to buy Dutch rival P&O Nedlloyd, in a move that would make it history's biggest container line.
Maersk, which owns the world's largest container shipping line, Maersk Sealand, said the industry needed to consolidate and that it needed more ships to continue to grow.
"There are two ways to grow: organically or via acquisitions," A.P. Moeller-Maersk CEO Jess Soederberg told Reuters. "With the current lack of ship capacity we would not be able to grow organically within the next three to four years."
Maersk Sealand already boasts the title of the world's largest container line, with more than 300 vessels and a total capacity of 750,000 20-feet containers. P.O. Nedlloyd has 156 vessels and a container capacity of 428,000.
A merger would result in the biggest container shipping company in history, more than double the size of its main contender, Mediterranean Shipping Co.
The Dutch parent company Royal P&O Nedlloyd is among the world's four largest container companies. It's board of directors said they recommended Maersk Sealand's offer, which will be officially placed in June, after a due diligence report has been issued on the Dutch company.
A takeover would also be dependent on at least 70 percent of shareholders in P&O Nedlloyd accepting the offer, as well as on the approval of competition authorities.
"This proposed offer represents a significant premium to our share price. I sincerely believe this proposal is in the best interest of both our shareholders and our employees," P&O Nedlloyd Chairman Andrew Land said in a statement.
P&O Nedlloyd said the takeover would lead to 1,500 job cuts.