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Maerskelina: Hanjin Shipping and HMM acquisition talk questioned

Yesterday’s comments by an analyst at Jefferies suggesting Maersk Line may look to buy both of South Korea’s top two troubled carriers, Hyundai Merchant Marine (HMM) and Hanjin Shipping, has been greeted with much derision by many commentators. Even a spokesperson for the Danish liner tweeted: “Believe only one @MaerskLine has not been linked to is Angelina Jolie…”

In an interview with Bloomberg yesterday, David Kerstens, Jefferies’s transport analyst in London, commenting on acquisition targets for Maersk, said: “The most likely scenario is that Maersk would take over the assets of Hyundai and Hanjin.”

Kris Kosmala, a Splash columnist and vice president for Quintiq Asia Pacific, warned regulators might oppose the move.

An even larger question, Kosmala posited, are the unfounded liabilities of both HMM and Hanjin which would dent Maersk’s balance sheets for years to come.

“Without finding some solution to leaving those liabilities behind, probably not without substantial help from the Korean government, this acquisition is not a sound business proposition,” Kosmala said.

Andy Lane from CTI Consultancy picked up on this latter theme from Kosmala noting that the Korean pair had a lot of “redundant” assets

“A full and outright acquisition is therefore maybe not so interesting for Maersk, but picking up select assets might be,” Lane suggested.

Lane warned however that buying the assets does not guarantee inheriting market share.

Tim Routh from portal China Sea Rates questioned whether Maersk had the cash in hand to fund an acquisition of Hanjin, let alone HMM as well.

“I would be extremely wary of Maersk acquiring anything,” Routh told Splash, who wondered why the Danish conglomerate was not actually going through a heavy write down and sell off to improve its bottom line at the moment.

“I love the headlines and the shock and awe of it all, but realistically a few simple reviews shows Maersk does not have the money at this point in time,” Routh claimed.

The government in Seoul went to some effort yesterday to pour cold water on the Maersk speculation.

“Even if Maersk seriously takes over the Korean shipping companies, (the ministry) will review the plan, considering such takeover goes against national interests,” said Oceans and Fisheries Minister Kim Young-seok in a parliamentary audit Tuesday.

Concluding, CTI’s Lane suggested that if Maersk passed on buying the Koreans, others might step in, especially the acquisitive European lines CMA CGM and Hapag-Lloyd, the latter of whom needs to boost capacity within the soon-to-launch THE Alliance.

 

With additional reporting by Grant Rowles

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Sam Chambers

Starting out with the Informa Group in 2000 in Hong Kong, Sam Chambers became editor of Maritime Asia magazine as well as East Asia Editor for the world’s oldest newspaper, Lloyd’s List. In 2005 he pursued a freelance career and wrote for a variety of titles including taking on the role of Asia Editor at Seatrade magazine and China correspondent for Supply Chain Asia. His work has also appeared in The Economist, The New York Times, The Sunday Times and The International Herald Tribune.
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