COSCO’s $6.3bn takeover of Orient Overseas International (OOIL), parent of container line OOCL, is now in doubt, according to Alphaliner.
The consultant said “doubts remain” whether the acquisition could be completed by the 30 June completion deadline.
Of concern is the pending greenlight from the Committee on Foreign Investment in the United States (CFIUS). In the past year, it has vetoed a number of deals involving Chinese buyers on the basis of a “threat to national security”.
Alphaliner said: “COSCO has not provided any official clarification on the status of its negotiations with the committee [CFIUS] so far. While COSCO reportedly proposed to divest or carve out the OOCL-owned Long Beach Container Terminal (LBCT) to help ease US national security concerns, no details of any such plan have been made public…”
It added that the situation regarding the LBCT “could prove difficult to resolve”, as it remained unclear why the US authorities seemed to be regarding COSCO’s proposed ownership as a ‘national security risk’.
Alphaliner argues that this has not been an issue under OOCL ownership and, furthermore, COSCO already controls two container terminals at the LA/LB San Pedro Bay port complex.
