Will Hong Kong's OOCL be eaten up by the world's biggest container lines?
OOCL has 2.7% of the world's market share.
With five of the top six global container lines increasing their market share through consolidation, the top six market share increased to 63%. Among the remaining carriers with global network, Hong Kong's OOCL, with 2.7% of the world's market share, seems to be one of the next targets.
According to Jefferies, one problem will likely be the willingness of the largest shareholder to sell. But more to this, the firm says the question is always the price.
"If we take CMA-CGM's acquisition of listed NOL as an example, CMA-CGM acquired NOL at 1.0x P/B and assumed the debt. Using the same multiple implies an acquisition value for OOCL of US$6.9bn," it explained.
Based on company data, OOCL net debt stands at $2.2m, while total equity sits at around $4.6m.