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CMA CGM to acquire Mercosul Line
Maersk Line will lose Mercosul to gain Aliança

CMA CGM to acquire Mercosul Line

CMA CGM has agreed to acquire Brazilian cabotage carrier Mercosul Line from Maersk Line, which made the sale to comply with competition authorities over its acquisition of Hamburg Süd.

A statement from the carriers noted that the sale would enable CMA CGM to strengthen its service offering to and from South America, most notably in Brazil and 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,” the statement added.

Rodolphe Saadé, CEO of CMA CGM, said: “[Mercosul] 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 continue providing best-in-class services to its customers.”

The pre-emptive measure was made due to concerns that Hamburg-Süd’s ownership of Brazilian cabotage company Aliança Navegação e Logística could represent an issue with competition authorities if Maersk were to keep control of Mercosul.

The Brazilian competition regulator Conselho Administrativo de Defesa Economica (CADE) would be likely to oppose the acquisition as Maersk would end up controlling close to 80% of the Brazilian coastal market’s teu capacity.

Currently, Aliança controls 59% of the market by capacity while Mercosul accounts for 21%; the remaining share is controlled by the companies’ competitor Log-In Logística Intermodal.

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 Q4 2017. Until then, Mercosul Line will continue business as usual.

A Maersk spokesperson told CM that Mercosul staff will remain at the company, rather than being transferred to Aliança once it is acquired. “CMA CGM will acquire the entire company with all assets,” he stated.

The Mercosul transaction is subject to Brazilian regulatory approval and the closing of Maersk’s Hamburg Süd acquisition.

Before the deal was announced, industry speculation indicated that MSC, Hapag-Lloyd, NYK Line and COSCO Shipping were thought to be in the running as well as CMA CGM.