China shipper Cosco to buy HK rival OOIL for $6.3bn

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OOCL Hong KongImage copyright
EPA

Chinese shipping hulk Cosco is set to buy its Hong Kong rival OOIL for $6.3bn (£4.9bn).

The understanding would make Cosco the world’s third biggest shipping company, with some-more than 400 vessels.

OOIL’s infancy owners has supposed the bid, yet the sale will still need regulatory approval.

It would be the latest in a call of mergers, which has left the top 6 shipping lines determining almost two thirds of the market.

Overcapacity struggles

OOIL’s auxiliary OOCL is now the world’s seventh largest shipping line, with 3.2% of global marketplace share, according to shipping database Alphaliner.

Cosco is charity $10.07 per share, a 38% reward over OOIL’s shutting cost on Friday.

The family of Hong Kong’s first Chief Executive Tung Chee-hwa founded OOIL, and still binds a 69% interest in the company.

They have supposed the offer, but it still needs the capitulation of Cosco shareholders, as good as US and Chinese regulators.

Overcapacity and negligence direct is heading to major changes in the shipping industry.

Korean shipping hulk Hanjin filed for failure last year, while France’s CMA CGM bought Singapore’s Neptune Orient Lines.

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