The CMA CGM maritime group acquires the FMS container terminal in Los Angeles

PARIS (Reuters) – Shipping group CMA CGM has agreed to acquire the Fenix ​​Marine Services (FMS) container terminal at the Port of Los Angeles for approximately $ 2 billion that will expand its presence into a hub crucial for trans-Pacific trade.

CMA CGM currently holds 10% of the capital of FMS and will buy the remaining 90% from the investment fund EQT Infrastructure III on the basis of an enterprise value of $ 2.3 billion, CMA CGM and EQT announced on Wednesday. .

The French company CMA CGM, one of the largest container shipping companies in the world, plans to shell out around $ 1.8 billion for the 90% stake and will finance the operation from its own funds, he said. added.

The Port of Los Angeles handles massive cargo volumes between China and the United States and has been caught in increasing shipping congestion as the coronavirus pandemic disrupted global supply and demand for goods.

FMS is the third largest container terminal in Los Angeles and its takeover will add to the 49 terminals CMA CGM has already invested in around the world, he said.

“The rapid recovery of the global economy has demonstrated the importance of ports and logistics infrastructure,” said Rodolphe Saadé, Chairman and CEO of CMA CGM, in a statement.

“It (FMS) is a key industrial facility that will significantly strengthen our position and support our rapid growth in this market. “

CMA CGM will act as the operator of the FMS terminal and plans to invest in the extension of the site’s capacity, in particular by the construction of a new berth, the extension of the container yard and the increase rail capacity for onward transport.

Like its maritime competitors, CMA CGM has extended its presence throughout the logistics chain in port infrastructures and non-maritime transport services.

Its revenues have jumped this year as the pandemic resulted in high freight rates and saturated ship capacity.

The acquisition of FMS, which is subject to regulatory approval, marks the return to CMA CGM’s ownership of the terminal it sold to EQT in 2017.

CMA CGM then sold 90% of the capital for an enterprise value of 875 million dollars in order to strengthen its finances following the acquisition of the Singaporean shipping company NOL.

The $ 2.3 billion enterprise value of the new transaction is 13.7 times FMS’s expected earnings before interest, taxes, depreciation and amortization (EBITDA) in 2022, according to CMA CGM.

(Reporting by Gus Trompiz; Editing by Sudip Kar-Gupta and Mark Potter)

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