New captain can steer Maersk into calmer waters 8 Feb 2017 The ailing Danish shipping and oil conglomerate reported disappointing fourth-quarter results, halved its dividend and replaced its chairman. Yet a rising oil price, recovering freight rates and Maersk’s coming split mean former SAP boss Jim Snabe is boarding at a turning point.
Container ship M&A crashes into sceptical market 31 Oct 2016 A three-way Japanese merger will create a new industry heavyweight. Yet investors are ignoring the promised $1 bln of annual savings. Even aggressive consolidation plans, it seems, are not enough to convince the market that battered shipping firms can get back on an even keel.
Shrink to greatness? It’s not always that simple 22 Sep 2016 Danish conglomerate Maersk just said it will break up. The shares barely moved. Carving up a complex corporate beast can make great sense - think HP. But some hybrid companies that resist being split, like Rolls-Royce, ABB and AB Foods, may have a point.
South Korea’s shipping collapse will be contained 5 Sep 2016 The plight of shipping giant Hanjin is causing global ripples. It is emblematic of the strife facing the maritime industries that powered the rise of South Korea. Yet conglomerates and the state are making tough choices. That suggests Hanjin won't drown others as it sinks.
Baltic Dry’s economic compass looks wet 16 Feb 2016 The indexed cost of shipping grains and minerals has hit record lows. While its prescience in 2008 may renew fears of a sharp global slowdown, the Baltic Dry has become a far less reliable health indicator. China’s troubles are partly to blame for the fall, but so are too many ships.
Maersk hasn’t yet reached its low water mark 10 Feb 2016 Cheap oil and collapsing freight rates hit the Danish conglomerate even harder than expected. A $2.6 bln writedown on oil assets and a dismal year-end sent 2015 net profit down 82 pct. A bleak outlook suggests Maersk’s dividend, and its valuation, may be unsustainable.
Container shipping deal stacks up in multiple ways 7 Dec 2015 French giant CMA CGM is buying Singapore’s ailing Neptune Orient Lines for $2.4 billion plus debt. Offering majority owner Temasek and public shareholders close to book value – a 49 percent premium – looks generous. But the unlisted buyer can chart a course to value creation.
Brookfield can sail off with Asciano 2 Jul 2015 The Canadian investor wants to buy the Australian ports and rail operator for $6.8 bln. A solid 36 percent premium was enough to get Asciano’s board talking. So shareholders seeking a big sweetener may be disappointed. Part-payment in shares could be the main obstacle.
Maersk definitively casts off conglomerate past 25 Feb 2015 The shipping giant has already streamlined and grown more open. Now it is shedding 20 pct of Danske Bank, the clearest break yet with history. Shares rose 6 pct. Transforming conglomerates can be like reorienting a super-tanker. But with focus in fashion, it’s worth the slog.
Fincantieri slide augurs ill for Italian selloffs 7 Jul 2014 The shipbuilder’s shares are below last week’s float price. Given the sizeable retail support for the offering, that is unhelpful for other potential stock market issues. That includes family firms and the state’s privatisation plan. The new government needs more market savvy.
China veto is wake-up call for world’s dealmakers 17 Jun 2014 Beijing’s antitrust enforcer has sunk its first overseas transaction, killing a Maersk-led container-shipping alliance. The national interest in protecting local outfits made this tie-up especially vulnerable. But there’s a real risk China could torpedo other global deals.
China’s vanishing metals corrode confidence 12 Jun 2014 Traders may have pledged copper or aluminium as collateral for multiple loans. Lenders can’t always spot such behaviour, and may have reasons not to complain too much or pull back too quickly. But metal-related antics are another sign of the weakness in China’s financing chains.
Joke’s on lenders in $2.6 bln Batista payback plan 19 May 2014 The fallen Brazilian billionaire wants investors in his bankrupt shipbuilder, OSX, to wait until 2040 for full payment and proposes an $11,000 installment after a year. To think he once boasted that his assets were “idiot proof.” His chutzpah now threatens OSX’s reorganization.
China’s shipbuilding supertanker will turn slowly 5 Jul 2013 Rongsheng, the biggest private shipbuilder, is on financial life support. An industry that once symbolised growing economic strength is now a drag. But don’t bet on a shakeout. In China, strategic sectors can stay afloat long after their apparent financial logic has run dry.
Norway triumphs over tycoon in strange M&A saga 21 Jun 2013 Shipping mogul John Fredriksen wanted to combine his seafood group, Marine Harvest, with smaller rival Cermaq. But Norway thwarted the $1.7 bln hostile bid. Consolidating key national industries is always tricky. Doubly so if you’re up against one of the world’s richest states.
More geopolitics than shipping in Nicaraguan canal 19 Jun 2013 A controversial $40 bln project to rival Panama’s passage doesn’t seem to make financial sense. But if its Chinese sponsor is any kind of proxy for Beijing, the idea of one day balancing U.S. influence in Central America isn’t far-fetched. And for that, the price could be right.
Hong Kong dockers’ pay sets tone for future strife 7 May 2013 Port workers have ended a month-long strike and accepted a 9.8 pct pay rise - half their original demand. Yet the conflict highlighted Hong Kong’s growing inequality and rising living costs. As China’s economy slows and shifts, dockers and employers will be increasingly at odds.
China export mystery fuels statistical scepticism 10 Apr 2013 Exports to Hong Kong jumped a staggering 93 percent in March, even as trade with the developed world fell. What’s going on? Companies may be disguising capital flows as trade. But however the aberration is explained, it provides another reason to mistrust official data.
Vietnam floats a lifeboat for foreign creditors 8 Feb 2013 The government has helped end a two-year standoff between bankrupt shipbuilder Vinashin and overseas lenders by guaranteeing a new $620 million bond. That will aid the country’s capital market rehabilitation. But the victims of other shipwrecks shouldn’t count on similar rescues.
Titanic’s century-old metaphor misses the point 11 Apr 2012 The famous 1912 sinking tells us something eternal. Life, even the most privileged, is like an ocean voyage, and then the ship goes down and you die. It also seems like a warning against modern hubris. But an iceberg couldn’t stop the spread of ever more advanced technologies.