HONG KONG: China Merchants Port Holdings Company Limited (“CMPort” or “The Company”, HKSE Code: 00144) is pleased to announce that, on 20 December 2019, CMPort entered into the Master Agreement with CMA CGM SA (“CMA CGM”) and Terminal Link SAS (“Terminal Link”) to set out the framework in relation to, among others, the Proposed Acquisition of 10 terminals of CMA CGM, CMPort’s subscription of the Mandatory Convertible Bonds to be issued by Terminal Link and the Loan to be provided by CMPort to Terminal Link for the purpose of financing the Proposed Acquisition.
Pursuant to the Master Agreement, Terminal Link will acquire a portfolio of participations in 10 terminals located in Asia, Europe, Middle-East and the Caribbean (Table 1), for a total consideration of up to US$955 million. CMPort will subscribe for the Mandatory Convertible Bonds in an amount equal to 49% of CMPort’s equity interest in Terminal Link with the overall subscription price up to US$468 million.
Separately, CMPort entered into the Loan Facility Agreement to grant Terminal Link a secured term loan facility of a principal amount up to US$500 million with a maturity of 8 years. Pursuant to the Master Agreement, the Company will be entitled to the Guaranteed Return provided by CMA CGM. All the contribution payable by the Company under the Master Agreement (including the subscription of the Mandatory Convertible Bonds and the provision of the Loan) will be in cash and funded by CMPort’s internal resources.
Upon completion of the Proposed Acquisition, Terminal Link will own various levels of equity interests in a portfolio of 23 terminals serving various regions such as Asia, Europe, Middle-East and the Caribbean. And hence CMPort’s global presence will expand from 18 to 26 countries and regions.
The Proposed Acquisition is another cornerstone of a mutually beneficial strategic partnership between CMPort and CMA CGM in operating and developing container terminals on a global basis and extending their relationships as business partners. CMPort believes that Terminal Link’s exposure to terminals in emerging and developed markets and its potential pipeline of new projects present another driver for its volume growth and financial returns in the future.
CMA CGM, with its affiliates, agrees to make its best endeavors to cooperate and support the other terminals of CMPort, with a target of an additional 300,000 TEUs per annum to CMPort’s West Shenzhen Ports.
With the vision of “to be a World’s leading comprehensive port service provider” CMPort has been actively exploring and acting on acquisition opportunities overseas as a pertinent mean to effectively add new growth drivers to its existing and sustainably growing ports business. With the Proposed Acquisition, CMPort will be able to enhance or gain presence to a mix of regions covering Asia, Europe, Middle-East and the Caribbean, each of which with their respective strengths and growth potential.
