CMA CGM and Maersk Line have entered into a binding agreement whereby CMA CGM will acquire Mercosul Line, one of the leading players in Brazil’s domestic container shipping market.
The sale of the South America specialist Mercosul was reportedly one of the conditions imposed on Maersk by competition authorities to allow Maersk’s acquisition of Hamburg Süd, which has a strong presence in the South America trades. The lines said the transaction “will ensure that the cabotage sector in Brazil remains competitive and that customers continue to benefit from a comprehensive choice of carriers”.
In a joint statement, the two global container shipping giants said the acquisition of Mercosul Line would allow CMA CGM to strengthen its service offering to and from South America, most notably in Brazil, a market with a strong potential for development, especially on cabotage and “door-to-door” services. “This activity is part of CMA CGM’s core strategy, which is to develop intra-regional sea transportation links and complementary services such as logistics,” CMA CGM added.
The Mercosul transaction is subject to Brazilian regulatory approval and the closing of Maersk’s Hamburg Süd acquisition. At the earliest, the integration of Mercosul within CMA CGM will start at the same time as the Hamburg Süd integration, which is expected in the fourth quarter of 2017. Until then, Mercosul Line will continue business as usual.
The parties said they had decided not to publicly disclose the price of the sale.
Rodolphe Saadé, CEO of CMA CGM, commented: “The acquisition of Mercosul represents a milestone in CMA CGM’s development strategy in South America. It is a well-managed company and we will leverage this platform to expand our footprint and service offerings to and from Latin America, seizing opportunities linked to the high growth prospects in this region.
“As a result, CMA CGM will be able to propose complete door-to-door services (and) continue providing best-in-class services to its customers.”
Søren Toft, COO of Maersk Line, said: “Mercosul is a highly respected and well-run company with an excellent fleet and customer value proposition. Its dedicated talents are well regarded both internally and externally.
“CMA CGM is a good fit for Mercosul and we are confident that they will continue to develop the company going forward.”
Launched in 1996 and acquired by Maersk in 2006, Mercosul Line is a specialist in the Brazilian internal transport market. Its fleet of four ships operates in Brazil and South America. The company reported revenues of US$128 million USD in 2016 and “offers strong profitability”, Maersk and CMA CGM said.