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Cosco to sell OOIL Long Beach terminal under US security agreement

Cosco Shipping Holdings is to sell the Overseas Orient International Ltd's (OOIL) Long Beach Terminal business to satisfy the requirments of the Committee on Foreign Investment in the United States (CFIUS) in its takeover of the Hong Kong-based container line.

Under the acquisition Cosco Shipping would gain indirect control of Long Beach Container Terminal.

To obtain CFIUS clearance Cosco Shipping and related parties in the takeover have entered into a

National Security Agreement with the US Departments of Homeland Security and Justice (USG parties) under which it will divest the terminal. The buyer of the terminal has to be acceptable to USG parties and not a shareholder in OOIL.

Until a suitable buyer is found ownership is to be transferred to a US Trust with the principal trustee a US citizen, with OOIL as the benficiary. OOIL will select the trustee with approval of the USG parties.

The remaining businesses of OOIL in the US are unaffected by the sale.

The $6.27bn acquisition of OOIL by Cosco cleared its final competition regulatory hurdle on 29 June, the National Security Agreement in the US was not a not pre-condition of the takeover offer.

Cosco Shipping plans to maintain OOIL as seperate listed company once the takeover is completed.

Read more: Cosco Shipping keeps commitment to OOIL listing, to divest 15% of shares

Cosco takeover of OOCL cleared for completion

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