Three investors eye CMA CGM stake
Three private investment groups are considering investing in CMA CGM, potentially bringing a needed cash infusion into the world’s third-largest container line, according to Bloomberg News.
Apollo Management, the private equity fund that put together CEVA Logistics, French private equity firm Butler Capital Partners and Louis Dreyfus, the Paris-based raw-materials trader and producer, last week requested financial information on the family-controlled company, four people familiar with the talks told Bloomberg. They declined to be named because the negotiations are private and at an early stage.
The investors would inject cash into CMA, which is trying to restructure $5.6 billion of borrowings after plunging demand for goods left it in breach of some debt covenants.
The Marseille-based company’s cash reserves fell to $599 million at June 30 after using $1.2 billion in the first half. CMA is also seeking to secure an additional investment from France’s FSI sovereign-wealth fund, the people said.
Creditors led by BNP Paribas have asked that Chief Executive Officer Jacques Saade be replaced before they agree to restructure the debt, support the search for new investors and help renegotiate some of the 49 ships CMA has on order from yards including South Korea’s Hanjin Heavy Industries & Construction Co., people familiar with the talks said last month.
A CMA spokeswoman said earlier Thursday it would consider changes. “The company is open to reinforcement of its current management team,” Anne-France Malrieu, a Paris-based spokeswoman, said in a statement. No appointments have been decided, she said.
CMA said last week that its operations will begin to break even this month as freight-carrying prices recover. Routes linking Asia with northern Europe, which account for 21 percent of its freight volumes, broke even in October as the rental rate for 40-foot containers rose to $2,140 from $800 four months earlier, it said.
Apollo Management, the private equity fund that put together CEVA Logistics, French private equity firm Butler Capital Partners and Louis Dreyfus, the Paris-based raw-materials trader and producer, last week requested financial information on the family-controlled company, four people familiar with the talks told Bloomberg. They declined to be named because the negotiations are private and at an early stage.
The investors would inject cash into CMA, which is trying to restructure $5.6 billion of borrowings after plunging demand for goods left it in breach of some debt covenants.
The Marseille-based company’s cash reserves fell to $599 million at June 30 after using $1.2 billion in the first half. CMA is also seeking to secure an additional investment from France’s FSI sovereign-wealth fund, the people said.
Creditors led by BNP Paribas have asked that Chief Executive Officer Jacques Saade be replaced before they agree to restructure the debt, support the search for new investors and help renegotiate some of the 49 ships CMA has on order from yards including South Korea’s Hanjin Heavy Industries & Construction Co., people familiar with the talks said last month.
A CMA spokeswoman said earlier Thursday it would consider changes. “The company is open to reinforcement of its current management team,” Anne-France Malrieu, a Paris-based spokeswoman, said in a statement. No appointments have been decided, she said.
CMA said last week that its operations will begin to break even this month as freight-carrying prices recover. Routes linking Asia with northern Europe, which account for 21 percent of its freight volumes, broke even in October as the rental rate for 40-foot containers rose to $2,140 from $800 four months earlier, it said.