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CMA CGM downgrade sparks fears as Jamaican terminal takeover approaches
JAMAICAN media and politicians have questioned French shipping giant CMA CGM's takeover of Kingston Container Terminal after Standard & Poor's and Moody's downgraded the carrier's debt.
The Sunday Gleaner reported the downgrade left senior government members worried that the company would not be able to fund the dredging of Kingston harbour when it takes over the terminal on July 1.
To allay fears, CMA CGM officials met with the Jamaican government and agreed to pay a US$30 million deposit, reported London's Container Management journal.
CMA CGM, through its subsidiary Terminal Link, is to dredge the navigation channel and expand terminal capacity from 2.8 million TEU to 3.2 million TEU within six years and then to 3.6 million TEU at a later date.
The takeover of the terminal has already postponed once, as it was originally scheduled for the first quarter of 2016.
CMA CGM made a loss of US$72 million in the first quarter of 2016 as its revenues, like those of its competitors, were hit by falling freight rates.
The credit rating agencies downgraded CMA CGM's long-term credit because of low freight rates and challenging conditions in the industry.
The Sunday Gleaner reported the downgrade left senior government members worried that the company would not be able to fund the dredging of Kingston harbour when it takes over the terminal on July 1.
To allay fears, CMA CGM officials met with the Jamaican government and agreed to pay a US$30 million deposit, reported London's Container Management journal.
CMA CGM, through its subsidiary Terminal Link, is to dredge the navigation channel and expand terminal capacity from 2.8 million TEU to 3.2 million TEU within six years and then to 3.6 million TEU at a later date.
The takeover of the terminal has already postponed once, as it was originally scheduled for the first quarter of 2016.
CMA CGM made a loss of US$72 million in the first quarter of 2016 as its revenues, like those of its competitors, were hit by falling freight rates.
The credit rating agencies downgraded CMA CGM's long-term credit because of low freight rates and challenging conditions in the industry.
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