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Hefty price tag could deter Hamburg Sud potential buyers: Alphaliner

Hefty price tag could deter Hamburg Sud potential buyers: Alphaliner
A hefty price tag of close to $5bn could put off potential buyers for German container line Hamburg Sud according to analyst Alphaliner.

The Oetker family, which owns 100% of Hamburg Sud, is reportedly close to reaching a decision as to whether to sell the container line, having previously been unable to agree.

Alphaliner said the asking price for Hamburg Sud was believed to be close to $5bn and this “remains the largest stumbling block on the way to any deal”.

The line’s ships and container assets are listed with a book value of $2.19bn athe end of 2015. With very little debt a potential buyer would be looking at a cash offer.

Maersk Line has been flagged up as the most likely buyer and this fits with ceo Soren Skou’s previous comments on being involved in consolidation.

However, Alphaliner also flagged up French line CMA CGM as a potential suitor. “The carrier could face a strong challenge from CMA CGM, which appears keen to maintain growth momentum after com- pleting the acquisition of APL in June this year,” it said in its weekly report.

However, CMA CGM could be limited by its debt burden of $9.6bn it was noted.

If Hamburg Sud is sold it would be the fifth major consolidation announced in container shipping in the space of a year following Cosco and China Shipping, CMA CGM and NOL/APL, Hapag-Lloyd and UASC, and the container businesses of NYK, Mitsui OSK Lines and K Line. With a 2.9% global market share Hamburg Sud is the mid-sized catergory which has been seen as particularly vulnerable following the collapse of Hanjin Shipping at the end of August, which also had a 2.9% market share.