Thursday 22nd Nov, 2018

COSCO clears hurdle to OOIL acquisition

Photo: Southern Cross Maritime
Photo: Southern Cross Maritime

THE Committee on Foreign Investment in the United States has determined that there are no national security issues with COSCO Shipping’s offer to acquire Orient Overseas (International) Limited (OOIL), according to an announcement from COSCO.

The committee reviews national security implications for foreign investments, and several US government agencies are represented.

The issue the committee had with the acquisition was that OOIL operates the Long Beach Container Terminal. But COSCO has agreed to sell of the terminal business to a third party. COSCO has also agreed to transfer ownership of the Long Beach terminal to a US trust  until a third-party buyer can be found.

With COSCO’s acquisition of OOIL and its shipping subsidiary, OOCL, it will become the third-largest container shipper in the world, with a capacity of 2.75m TEU, or 12.3% of global capacity, according to figures from Alphaliner.

The deal was announced about a year ago, with the price for OOIL estimated to be US$6.3bn.



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