Shipping firm CMA CGM signs debt restructuring deal
PARIS, Feb 12 (Reuters) - CMA CGM, the world's third-largest container shipping firm, has sealed a debt restructuring deal with its banks as part of efforts to strengthen its finances, the French group said on Tuesday.
Family-owned CMA CGM had been in talks for a year with its banks to modify its debt terms to ease the financial pressures caused by a volatile freight market.
The company, which had a net debt of around $4.6 billion at the end of 2012, said the agreement would partially reschedule a credit line expiring this year in new three-year loans worth 280 million euros ($375 million).
The deal will also modify the terms of CMA CGM's bank debt to take into account volatility in freight sector, it said in a statement.
This means the financial ratios it will have to respect will no longer be based on core operating profit but on its assets, which included about $4 billion in cash at the end of 2012.
In other steps to improve its financial base, CMA CGM last year signed an agreement with France's sovereign investment fund FSI and Turkish shareholder Yildirim Group under which they are to invest $150 million and $100 million respectively in CMA CGM through bonds redeemable in shares.
It then agreed in January to sell a 49 percent stake in its Terminal Link division to China Merchants Holdings (International) for $400 million euros.
"CMA CGM's agreement with its banks together with new equity injection will result in a significantly more resilient and flexible financial structure," the company said in a statement.
The company told Reuters in December it was considering listing shares on the Paris stock exchange by the end of 2014 to enjoy better access to financing.
($1 = 0.7474 euros)
(Editing by Greg Mahlich)