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Wednesday, August 16, 2017

Maersk Break-Up Soon ?

August 20, 2016

Photo: Maersk Line

Photo: Maersk Line

 A.P. Moeller-Maersk A/S, in its strategic review, is considering several options including a two-way split into an energy and a transport company, says a Bloomberg report.

 
According to Danish daily Berlingske, the shipping group is likely to break up into transportation and energy divisions.
 
"Maersk Transport" would include the Maersk Line, APM Terminals, Maersk Tankers, Damco and Svitzer units, while "Maersk Energy" would include Maersk Oil, Maersk Drilling and Maersk Supply Service.
 
The company's chairman first floated the idea of breaking up its business segments in June after appointing a new chief executive, Soren Skou.
 
"The question is whether we should be a large group, or whether we should be a number of independent companies," Chairman Michael Pram Rasmussen told Danish online media Finans.
 
Louise Muenter, head of media and stakeholder relations at Maersk in Copenhagen, said that the structure of the group is one of many options being evaluated, but it is important to point out that it is one of many possibilities, as structure alone doesn’t ensure growth.
 
A Reuters report said that the board of directors had told Skou to "investigate the strategic and structural options to further increase agility and synergies." It plans to report on its progress by the end of the third quarter of the year.
 
According to a Jefferies report Energy makes up 35% of net asset value with shipping accounting for the remaining 65%. 
 
Maersk Line is fighting to remain the world's leading container shipping carrier as a wave of mergers and acquisitions, particularly in Asia, creates new challengers trying to grab a bigger share of a depressed market.
 
Maersk revenue stood at $40 billion last year. Its shipping business of more than 600 container vessels is its biggest.
 
Jefferies analysts said they expected the outcome of the review to be "drastic". This was due to the fact that the newly appointed CEO Soren Skou remained leader of Maersk Line while taking on the CEO responsibilities. He was also given a mandate of reviewing all strategic options.
 
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