CSAV said it has called an extraordinary shareholders’ meeting for March 21, “when investors should approve the possible merger of CSAV’s containership business with those of the German shipper Hapag Lloyd.”
CSAV said should the merger be completed, it would receive 30 percent of the combined company, a percentage subject to closing adjustments.
The Santiago, Chile-headquartered container shipping company also announced Thursday that it had a loss of $169 million in 2013 but noted that was a 46-percent reduction from the 2012 loss of $313.6 million.
“These results are in the context of a particularly complex year for the shipping industry, which has had to continue facing high volatility in freight rates and an overcapacity of ships,” said CSAV.
Oscar Hasbún, chief executive officer of CSAV, said, “While the industry continues to be in an unstable scenario, the improvement in the results is mainly due to the internal changes we have made in the company.”
He added that in a “balanced industry scenario, the company has great profit potential.”
Hasbún said a large investment that CSAV has made to increase its owned rather than leased fleet of containerships will be a determinant factor in the results for the coming years.
“The company had no assets before, so it had high ship-chartering costs. This situation is now changing thanks to the large capital injections made. By the end of 2015, we will have over 50 percent of own fleet, which will also be one of the most modern and efficient in the industry”.
In addition to being asked to approve a merger with Hapag-Lloyd, CSAV said shareholders will vote on a capital increase of $200 million, to be carried out during the first half of this year. Its principal purpose is to complete the financing for the acquisition of seven 9,300-TEU containerships currently being built.
The company said its controlling shareholder, Quiñenco, “is committed to acquire the balance of shares not subscribed by the market during the pre-emptive option period, until completing the proceeds of $ 200 million.”
CSAV also revealed that it had reached an agreement with the U.S. Department of Justice which is conducting an investigation to determine the existence of anti-trust practices in the car-carrier market.
CSAV said it has signed an agreement with Justice to pay a fine of $8.9 million.
“In September 2012, with the notification of the start of the investigation, the board and management became aware of the possibility that these practices existed within CSAV. Immediately, and with the unanimous agreement and mandate of the board, we decided to collaborate, instructed an internal investigation, took a series of measures to strengthen all the internal control processes, and gave training to the company’s sales and trade teams around the world,” said Hasbun. “This included the creation of a compliance officer position whose main focus of attention is precisely respect for free competition standards in the world.
“During the investigation, and against the company’s policies, conducts were detected contrary to free competition. As a result, it was decided to reach agreement with the American authority,” he said.
CSAV shareholders to vote on Hapag-Lloyd merger
