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China Merchants Port to acquire stakes in 10 CMA CGM Terminals for $995m

China Merchants Port Holdings Company Limited (“CMPort” or “The Company”, HKSE Code: 00144) has announced that it entered into a comprehensive Memorandum Of Agreement (“MOA”) with CMA CGM SA (“CMA CGM”), pursuant to which Terminal Link SAS (“Terminal Link”) will acquire a portfolio of participations in 10 terminals located in Asia, Europe, Middle-East and the Caribbean (the “Terminals Portfolio”) currently owned by CMA CGM for a total consideration of US$955million.

Pursuant to the MOA and in order to finance the proposed acquisition by Terminal Link (the “Proposed Acquisition”), CMPort will subscribe for a US Dollar-denominated Mandatory Convertible Bonds (“MCB”) in an amount up to US$468 million with a coupon rate of 6.0%; and will grant a secured term loan facility (“Loan Facility”) of a principal amount of up to US$500 million with an interest rate of 6.0% with a maturity of 8 years, issued by and to Terminal Link for a total amount of up to US$968 million. The interest and principal under The Loan Facility will be funded primarily by the way of share capital increase of Terminal Link subscribed by CMA CGM.

In line with the successful partnership initiated in 2013, the Proposed Acquisition constitutes a unique opportunity to expand Terminal Link’s network and gain exposure to a sizeable portfolio of terminals located in regions with strong growth prospects.

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.

In addition, this significant transaction is another cornerstone of a mutually, highly 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.

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