[EN-SEA] Saade Becomes Chairman, No Longer CEO at "CMA CGM"

TROUBLED French shipping giant CMA CGM will have a new CEO as its founder Jacques Saade withdraws to become chairman while Philippe Soulie takes over as CEO as part of a US$500 million rescue package between creditor banks and the Ministry of Finance.

Details to be ratified at a shareholders meeting Wednesday December 23.Said Mr Saade: "With this agreement, our financial partners are affirming confidence in the group. Our strategy to return to profitable growth is therefore proven to be valid."

CMA CGM, the world's third largest container shipping line, after Maersk and MSC, has repeatedly said that it would break even by the end of the year and return to profitability in 2010.

Mr Soulie, a former top advisor at Alstom, world leader in engineering turnkey electric power plants, is also the president of the Constructions Industrielles de la Mediterranee (Cnim), a construction contractor which builds waste-to-energy plants.

Said Mr Saade: "The arrival of Philippe Soulie as CEO and experienced and independent board members, the group now has the resources to build on this new dynamic."

After five hours of talks at the French finance ministry, agreement was reached with "financial partners" to provide a short-term US$500 million credit line. Creditor banks have long demanded Mr Saade to be sidelined if they were to reschedule the company's $5.6 billion debt, mostly arising from the ordering of 59 ships.

Denis Ranque, former head of the French defence company Thales Group and Christian Garin, chairman of the French Shipowners Association, now join the board.

These appointments are made to provide lenders oversight of the internal affairs of the private family-owned company.

The credit facility will "enable the group to pursue the current talks regarding its debt restructuring and a capital increase planned for the second half of 2010 with the arrival of new investors," said a CMA CGM statement.

CMA CGM said partners are "expected to facilitate ongoing discussions with the Korean shipyards concerning the cancellation or the postponement of ships on order."

A CMA CGM spokesman said the company was considering an appeal to investors to raise $300 million to $400 million. CMA CGM seldom makes financial disclosures.

CMA CGM, noted American Shipper, has been one of the fastest growing container shipping companies in recent years and has an aggressive newbuilding programme.

It has a fleet of 354 ships of 1.02 million TEU with 497,512 TEU on order or 48.6 per cent of its current fleet, according to Paris-based AXS-Alphaliner.

Source : HKSG, 21.12.09.