France’s Bollore Group has pledged to to consider €5bn ($5.5bn) put option offer by CMA CGM for its transport and logistics operations, almost a month after the French container line expressed interest in buying the firm.
Bollore, a French conglomerate, had previously received a “spontaneous indicative offer” on 18 April from Rodolphe Saade-led CMA CGM that valued the operations at €5bn.
Both sides have since been working towards a final deal by Monday, but that has not happened yet, according to individual statements.
CMA CGM said on Monday that it has given a put option — essentially an exclusive offer — to buy the business from Bollore Group for the aforementioned €5bn after a series of exclusive talks held since 18 April.
“Bollore Group has accepted the proposal as a put option,” CMA CGM said in a statement.
“Final completion of the transaction remains subject, first, to the examination by employee representation, and then to customary regulatory approvals.”
The Bollore Group said on Monday that it has accepted the put option “strictly as an offer” that it must discuss first before making any official moves to sell its transport and logistics segment.
“The information and consultation procedures with the relevant staff representative bodies of the Bollore Group pertaining to this transaction shall now be initiated,” the French company said.
“The decision as to whether or not to exercise this put option will be taken at the end of these procedures.”
If the deal went through, CMA CGM would buy the division for actually €4.65bn after factoring in minority interests and debt tied to the business.
CMA CGM would also pay an additional €0.25 per share to Bollore Group shareholders.
“This contingent earn-out will be paid if the put option received from CMA CGM is exercised and the sale of 100% of Bollore Logistics is completed pursuant to agreed upon terms,” CMA CGM said.
If it is carried out, the acquisition would be CMA CGM’s largest transaction since the company was founded in 1978, the liner said.
“It would significantly strengthen the CMA CGM Group’s logistics business and make a top-five player in global logistics,” the French liner giant said.
CMA CGM Group’s annual logistics revenue would reach $24bn and its annual shipping volume would surpass 2m teus if the group took over Bollore Group.
The purchase would also expand CMA CGM Group’s worldwide warehouse space by 900,000 square metres to 11.2m square metres owned by subsidiary Ceva Logistics. The group’s employee count would grow by 14,000 workers to 169,000 employees.
“The acquisition would also open up access to major logistics hubs, especially in France and Asia,” CMA CGM said.
For the CMA CGM Group, this acquisition would represent a major step forward in its development of a full range of solutions supporting customers’ supply chains through handling end-to-end transport and logistics.”
