COSCO Moves Up a Spot – For (Too?) Much Money
After months of persistent rumors since January 2017 about a takeover of Orient Overseas Container Line (OOCL) by COSCO Shipping, the speculation is now over. The Chinese state-owned shipping giant COSCO has officially confirmed it will pay $6.3 billion for the Hong Kong-based company, founded in 1947.
Trading Suspended Amid Takeover Talks
COSCO suspended trading of its shares in mid-May 2017, citing "restructuring of fixed assets" in an internal announcement.
This move intensified the takeover rumors, especially as COSCO had previously suspended trading in 2015, shortly before announcing its merger with China Shipping.
OOCL operates 270 vessels, and the industry had widely anticipated a buyout.
| Ranking | Rederij | TEU | Marktaandeel |
| 1 | A.P. Moller-Maersk | 3.444.025 | 16.4% |
| 2 | Mediterranean Shipping Co | 3.081.196 | 14.7% |
| 3 | COSCO Shipping | 2.421.501 | 11.6% |
| 4 | CMA CGM | 2.359.493 | 11.2% |
| 5 | Hapag-Lloyd | 1.516.825 | 7.2% |
| 6 | Ocean Network Express | 1.436.502 | 6.9% |
| Totaal | 14.234.571 | 68% | |
Now the World’s Third-Largest Carrier
With the acquisition, COSCO—previously ranked 4th globally—has now overtaken the competition to become the world’s 3rd largest shipping company, behind:
A.P. Moller-Maersk (Denmark)
Mediterranean Shipping Company (MSC) (Switzerland)
Together, COSCO and OOCL now operate over 400 vessels with a combined capacity of 2.9 million TEU.
90% of OOCL shares will go to COSCO
The remaining 10% will be owned by the Port of Shanghai
The acquisition still awaits regulatory approval from antitrust authorities
Overpaying? A Risky Bet
While OOCL is widely regarded as one of the most stable and well-run carriers in the global market, the purchase price is $1.5 billion above its estimated market value, according to analysts.
The China Development Bank, which recently extended a $26 billion credit line to COSCO to finance the deal, has made a high-stakes decision.