Business
11:51, 09-Jul-2018
China's COSCO Shipping wins US security clearance for OOIL deal
Updated
11:04, 12-Jul-2018
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China’s COSCO Shipping Holdings said on Sunday a key US review body has cleared its planned 6.3-billion-dollar acquisition of shipping firm Orient Overseas International Ltd (OOIL) on security issues.
COSCO said on June 30 that all pre-conditions for the OOIL offer made last year had been met after receiving approval by the Chinese anti-monopoly regulator. It already has approvals from European and United States anti-monopoly regulators.
In a regulatory filing on Sunday, the company said the US Committee on Foreign Investment had notified that it does not have any outstanding security issues, following an agreement with the US government for OOIL to divest the Long Beach container terminal business to a third party.
COSCO said ownership of the container terminal business will be transferred to a trust while a buyer is sought.
There had been concerns the trade war between Beijing and Washington might end up hampering major deals by US or Chinese firms seeking regulatory approval.
US and China on Friday implemented tariffs against each other’s goods, with no signs of a near-term resolution.
COSCO’s acquisition of OOIL will see the Chinese shipping giant become the world’s third-largest container shipping line.
The deal is the latest in a wave of mergers and acquisitions in global container shipping that has left the top six shipping lines controlling 63 percent of the world market and comes at a time when the industry is experiencing a recovery after a lengthy downturn.
Source(s): Reuters