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COSCO to acquire 5 China units of Singamas Container Holdings

Logistic News - Published on Thu, 09 May 2019

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Caixin reported that the shipping container business of state-owned logistics leviathan China COSCO Shipping Co Ltd is set to gobble up five Chinese units of a Singapore. Singamas Container Holdings Ltd has agreed to sell five of its Chinese shipping container business units for approximately USD 565 million in a bid to get things shipshape. The COSCO unit, which was not named in the filing, will take 100% stakes in the five container units, namely Qidong Singamas, Qingdao Pacific, Ningbo Pacific, Singamas Container (Shanghai) and Qidong Pacific. The parent Singamas will use the proceeds to focus on researching and developing specialized containers, rather than the general use “dry freight” containers mainly used by the shipping industry, the filing said.

The move further consolidates the already airtight container market. Singamas already had a 20% share of the global container market, ahead of COSCO subsidiary Shanghai Universal Logistics Equipment Co. Ltd. with around 5%. While China International Marine Containers Co. Ltd. dominates the Chinese industry with roughly half of market share, COSCO has a 22.72% stake in the country, the second largest after China Merchants Group’s 24.58% stake, according to COSCO’s 2018 annual report.

Parent COSCO Shipping continues to be a major investor in global port infrastructure, agreeing to acquire a USD 225 million, 60% stake in the port of Chancay in Peru in January, and agreeing to spend USD 738 million on a new port in Abu Dhabi in 2016. However, earlier this month another of the company’s units said it will sell its stake in California’s Long Beach Container Terminal for USD 1.78 billion to address US security concerns.

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Posted By : Mohan Sharma on Thu, 09 May 2019
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