Hapag-Lloyd and CMA CGM have revealed plans to tap the bond market with offerings worth EUR 800m ($910.5m) in total.
The German boxship owner is issuing a new bond worth EUR 300m and intends to use the proceeds for the early redemption of its euro bonds due in 2018 and 2019.
Hapag-Lloyd’s notes will mature in seven years, while the company expects to begin the bond redemption in October.
This will be the second debt sale for Hapag-Lloyd in 2017 as the company offered bonds worth EUR 200m in January.
As TradeWinds reported last week, Standard & Poor’s has taken Hapag-Lloyd off its CreditWatch list thanks to the company’s good history of absorbing mergers deals.
Hapag-Lloyd closed the merger with United Arab Shipping Co (UASC) last month and is expecting annual synergies of $435m from 2019 onwards.
Its rival CMA CGM is also hitting the road for bond financing.
The French conglomerate is issuing unsecured notes worth EUR 500m, with net proceeds to be used for the repayment of an existing bond due in 2018 and Neptune Orient Line (NOL) notes due in April.
CMA CGM’s new bonds will be traded on the Luxembourg Stock Exchange with Credit Agricole, Societe Generale and UniCredit acting as joint bookrunners.
Market sources tell TradeWinds that although the simultaneous announcement is “a coincidence”, it is a sign that the bond market is favourable for shipowners right now.
Earlier today, the Marseilles-based company announced a $817m deal to offload a terminal in Los Angeles.
TradeWinds has contacted CMA CGM for further comment on the bond issue.
