COSCO Group nears US$4 bln takeover of Orient Overseas

COSCO Group is in advanced discussions to acquire Orient Overseas Container Line Co. for at least US$4 billion in a deal that could be reached as early as July, the Wall Street Journal reports. COSCO Group’s COSCO Shipping is the world’s fourth largest container operator with an 8.5 percent market share. Orient Overseas is in seventh place with a 3.3 percent share.

Container shipping, which moves the majority of the world’s manufactured goods, is a US$1 trillion a year industry.

COSCO stands to benefit from Orient Overseas’ sales team and young fleet, which data provider VesselsValue estimates is worth about US$1.5 billion. COSCO merged with China Shipping (Group) in December 2015. Earlier this year, it secured a US$26 billion multiyear financing deal with China Development Bank.