Jacques Saade said “thanks, but no thanks” to a $1bn investment offer from new Turkish business partner Yildirim Group.
The CMA CGM chairman also has no intention of relinquishing control of the family-run containership giant as it found a like-minded partner.
Marseilles-based CMA CGM announced on Thursday that Yildirim had come up with a cash injection of $500m in return for a 20% slice and three board seats for five years. The Turkish industrial conglomerate was, however, willing to cough up twice the amount but saw its offer rejected by Saade.
Robert Yuksel Yildirim, president and chief executive of the Istanbul-based outfit, told reporters during a joint telephone conference on Friday that he had not tried to negotiate the offer of investment put on the table by CMA CGM, choosing instead to accept the terms as given to him.
But Yildirim also said Saade had politely declined a $1bn package as he did not deem it necessary for the French company. The Turk insisted, however, that the money remains on the table should it be needed in the future.
The issue of extra funds seemingly being available on tap for CMA CGM raised questions as to why it was in an advanced stage of discussions with its own government about receiving a further $150m from France’s sovereign wealth fund in return for a minority shareholding.
Executive officer Rodolphe Saade retorted that the amount being sought from the government was not itself the kernel issue, rather that any injection from the government would be a signal for reassurance to the owner’s banks and shipyards currently building its vast orderbook which forms the bulk of its around $5bn debt.
“In case the market turns south we will have the opportunity to return to our partner,” Saade said of the open offer from Yildirim. “They are very open-minded, they are straightforward and a discussion can be very frank with them.”
Yildirim said there was also an open offer for the Turkish company to assume more management control at CMA CGM should the French owner request or require it, but insisted this was not the basis upon which Thursday’s announced deal – set to be completed in early January – was agreed.
“We do not want to get involved in the day-to-day running of the company,” Yildirim said, continuing that the company has no intention of putting anyone in a management position at CMA CGM.
Saade said the liner owner is currently studying a new governance plan with a view to implementing it next year but the firm intention is to keep CMA CGM as a family-owned entity under the ultimate control of his father Jacques.
“We are looking to organise the rest of the team around him,” he said of the company founder.
“They do know what shipping is all about and they do understand our problems and share our concerns,” Saade junior continued of the Yildirim group.
The Yildirim boss for his part explained that the group’s investment in CMA CGM was “not about money” but rather about it gaining more “international recognition” in the shipping industry.
“Money is secondary for us at the moment. We believe we made the right decision to be in the right place,”
Yildirim said his company was chosen by Saade above other investment hopefuls – a Qatari state fund as well as private investors in Belgium and the US – as it was not approaching the issue purely from a capital investment angle.
“We see ourselves more in the industry than the financial side. We speak the same language as [CMA CGM]. We know the shipping business, the shipbuilding business, the port business.
“I think CMA will be better and stronger in the market from this cooperation, as we are not only in the shipping but also the commodity side.
“It’s a win-win situation.”
