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CMA CGM Offers $5.5 Billion for Bollore Logistics Unit

Bloomberg
Total Views: 1108
April 18, 2023

By Tara Patel and Benoit Berthelot (Bloomberg) —

Rodolphe Saade, the French billionaire at the helm of shipping giant CMA CGM SA, shows no signs of slowing his protracted acquisition spree, making an unsolicited €5 billion ($5.5 billion) offer to buy Bollore SE’s logistics arm. 

Bollore, a holding company controlled by another ultra-wealthy and deal-hungry French businessman, Vincent Bollore, received an indicative offer from closely held CMA CGM, according to a statement Tuesday. Bloomberg News reported in February that Marseille-based CMA CGM, which is controlled by the Saade family, was interested in acquiring the unit. 

CMA CGM aims to make a definitive offer around May 8 after an audit and contract negotiations, according to the statement. The potential acquisition is part of its strategy to develop both in logistics and shipping, CMA CGM said in a separate statement.

Bollore shares rose as much as 5.5% in Paris trading. 

Saade, who took over as chief executive officer of the world’s third-largest container line from his late father, has been on a deals tear, spending some of the windfall profits accrued during the Covid-19 health crisis when freight rates rose to records and supply chains were disrupted. CMA CGM’s 2022 net profits rose to a record $24.9 billion, surpassing the $17.9 billion in 2021.

Similarly, Vincent Bollore has also been active in mergers and acquisitions even before this latest move. He recently closed the sale of his group’s African ports business to MSC Mediterranean Shipping Co., a top container line headed by billionaire Gianluigi Aponte, for 5.7 billion euros. 

Should the deal with CMA CGM go through, Bollore would be exiting the logistics business that he spent most of his career building. Armed with an even greater war chest, he would be expected to turn his focus to his media assets, the second leg of his industrial empire.

Vivendi Stake

Bollore could raise his stake in conglomerate Vivendi SE, a company in which he is already the majority shareholder, according to analysts. The 71-year-old has already started reshaping Vivendi through the 2021 IPO of Universal Music Group in which it retained a 10% stake.

With operations in pay-TV through Canal+, advertising and the press, Vivendi is currently focused on acquiring media rival Lagardere SA, which owns Hachette, the world’s third-largest publishing house.

For his part, Saade has already spent billions on transport and logistics assets, although he has also moved aggressively into media. 

In 2021, CMA CGM reached deals to acquire Ingram Micro Inc.’s e-commerce contract logistics business for $3 billion including debt, and agreed to purchase a container terminal in the Port of Los Angeles for an enterprise value of $2.3 billion. More recently, CMA CGM agreed to buy two other major US shipping terminals owned by Global Container Terminals Inc., one in New York and the other in New Jersey. 

Media Division

The 53-year-old Lebanese-born executive has also created a media division within CMA CGM for assets including La Provence, a regional newspaper in Marseille, and a 10% stake in French TV broadcaster M6. He also bought a 16% stake in Brut, an online, youth-focused media platform.  

The Saade family is worth $32.5 billion, according to the Bloomberg Billionaires Index, while Vincent Bollore has a fortune estimated at $9.4 billion.

On a trip to China this month as part of French President Emmanuel Macron’s business delegation, Saade praised Bollore’s logistics arm.

“They do a great job in logistics,” he told Bloomberg News. “We have a great deal of respect for them.”

Bollore Logistics employs 15,000 staff in 148 countries, according to its website. It manages hundreds of thousands of tons of air and ocean freight for companies in sectors ranging from health care to food and drink.

CMA CGM’s own logistics business operates in more than 160 countries, offering air and ocean freight.

–With assistance from Samy Adghirni, Angelina Rascouet and Francois de Beaupuy.

© 2023 Bloomberg L.P.

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