This from a Tradewinds article summary: CMA CGM appears to be closing on the finalisation of a billion-dollar debt restructuring after striking a tentative deal to accept an infusion from France’s sovereign wealth fund....
I'm sure someone here has access and can summarize? Or, we'll hear soon enough.
CMA CGM lines up injection
CMA CGM appears to be closing on the finalisation of a billion-dollar debt restructuring after striking a tentative deal to accept an infusion from France’s sovereign wealth fund.
CMA CGM boss Jacques Saade.
Market sources tell TradeWinds the Jaques Saade-led liner giant is in the advanced stages of negotiations that could lead to a $150m equity injection from Fonds Strategique d’Investissement (FSI) but note pen has not officially met paper.
The timing of the investment and other details remain unclear but some believe it would give FSI a 6% stake in the company and claim it would clear a path for the restructuring of some $4bn in debt as the overhaul is widely thought to be contingent on an infusion from outside backers.
During the French carrier’s second quarter conference call with bondholders finance chief Michel Sirat said the restructuring was “moving forward but not concluded” and indicated an update about talks with“liquidity providers” would likely come by year-end or even sooner.
The size of the potential injection is far lower than the one offered by affiliates of Turkish investor Yildirim, whose principal said he hoped to get answer by August as to whether CMA CGM would welcome a further $250m injection to aid in its high stakes financial shuffle.
At the time, Robert Yuksel Yildirim told TradeWinds weekly that the containership operator would welcome the lifeline with open arms but only if the favoured alternative, the sale of a stake to FSI, failed to materialise.
It’s difficult to determine how many counterparties have a vested interest in CMA CGM’s financial stability but as the world’s third largest liner group it’s not hard to understand why the market has anxiously awaited an update for some time.
What’s working in the company’s favour, observers have noted, is that the containership sector has improved over the past several months- which means a stake is probably worth more than what it had been when the carrier first started to feel the squeeze.
As we have reported, CMA CGM is looking to restructure loans on debt due in 2013 and 2014 and to amend certain covenants agreed in 2010, the year Yildirim paid $500m to pick up a 20% slice with an option to buy a further 10% at $250m.
Calls to CMA CGM seeking comment were not immediately returned on Tuesday