Can More Container Consolidation Happen?

In the above piece from Stephen Gong and Photis Panayides the conclusion can be construed as obvious: once a merger is announced, in general, in the liner industry, if the company is publicly traded, then there is a beneficial effect for both the acquirer’s shares as well as the acquired. Of course, this is the intention whenever a public company acquires any company: the focus on earnings and growth that public companies have dictates this.

Consolidation in the container industry seems to make more sense today than ever before from a macro- industry point of view. As all are aware, too much fleet capacity and too many containers plague the container industry. Ports are clogged and containers are very often trading laden in one direction which, along with old depreciated boxes being worth more on paper than newer ones bought during the Asian crisis, offsets any savings that may be made with cheaper box-hire rates. Consolidation is desirable so that some modicum of market share can be controlled and some dream of market contraction can be realize

This is only an excerpt of Can More Container Consolidation Happen?

Content is restricted to subscribers. To continue reading please Log-In or view our subscription options.