French container shipping major CMA CGM S.A. today launched an all-cash voluntary conditional general offer for all outstanding shares of Neptune Orient Lines Limited (NOL), NOL said in an update.
As disclosed, CMA CGM currently owns 10.5% of all NOL shares, and intends to delist and privatise NOL through the offer. In acceptance of the offer, NOL’s majority shareholders (Temasek Holdings (Private) Limited and its affiliates), which own 66.78% of all NOL shares, will tender all of their NOL shares.
Maybank Kim Eng Securities Pte. Ltd. (MKES) has been appointed as the independent financial adviser (IFA) to advise the directors of NOL.
The offer price is SGD 1.30 per NOL share in cash, totaling in SGD 3.4 billion (USD 2.43 billion).
“The offer provides NOL shareholders with an opportunity to realise their investment in NOL at a 49% premium to NOL’s unaffected share price on 16th July 2015 and a 33% premium to NOL’s 3-month volume-weighted average share price prior to 16th July 2015,” NOL said in a statement.
CMA CGM believes that the acquisition of NOL would enable it to reach a capacity of approximately 2.35 million TEUs, a market share of approximately 11.7%, a fleet of approximately 540 vessels and a combined annual turnover of approximately USD 21 billion.
Under the plan, CMA CGM plans to contribute to reinforce Singapore as a center of excellence in the field of maritime activities as the company intends to use Singapore as a key hub in Asia by establishing a regional office in the city-state.
The move follows approvals by the relevant regulatory authorities in the European Union and China.
“The independent directors, having considered carefully the fairness opinion rendered to the NOL board by Citigroup Global Markets Singapore Pte. Ltd., as NOL’s financial adviser in this transaction; the terms and conditions of the offer; as well as the advice given and recommendation made by MKES as the IFA, concur with the recommendation of MKES in respect of the offer. Accordingly, they recommend that NOL shareholders accept the offer, unless NOL shareholders are able to obtain a price higher than the offer price on the open market, taking into account all brokerage commissions or transaction costs in connection with open market transactions,” said NOL non-executive independent Chairman, Kwa Chong Seng.
“6 months after the announcement, and after receiving the relevant authorizations, CMA CGM today opens its offer for NOL shares. We offer each and every NOL shareholder SGD 1.30 per share in cash. In a particularly challenging international context in the shipping sector, our offer fully and fairly values NOL. We believe this is an attractive offer for all shareholders, as it was for Temasek and its affiliates, which have committed to tender their 66.78% stake,” said Rodolphe Saadé, Vice-Chairman of CMA CGM.
Acceptances of the offer must be received not later than 5.30 p.m. (Singapore time) on 4 July 2016, or such later date(s) as may be announced from time to time by or on behalf of CMA CGM.