China Shipping Giant COSCO Offers $6.3 Billion for Orient Overseas Ltd
China Shipping Giant COSCO Offers $6.3 Billion for Orient Overseas Ltd. The Chinese shipping company COSCO Shipping wants to take over its smaller competitor Orient Overseas International (OOIL) from Hong Kong. The company announced Sunday that it is willing to pay $6.3 Billion for that.
COSCO collapses with port company Shanghai Port Group, which takes nearly 10 percent interest in the company. As the acquisition continues, the third container manager in the world, behind the Danish A.P. Moller-Maersk and the Swiss Shipping Company, is established.
A fusion of the two major Chinese shipping companies has been speculating for several months. The container industry has been struggling for longer with unfavorable market conditions.
Owing to overcapacity margins are under pressure, and many companies have lots of effort to stay out of the red numbers.
The competition also tries to increase costs by increasing scale. For example, Maersk is in possession of his German rival Hamburg Süd and took over the French CMA CGM branch head Neptune Orient Lines (NOL) last year in Singapore.