COSCO Eyes PIL Takeover
COSCO, the world’s third-biggest container carrier by market share, is considering making a bid for Singapore’s Pacific International Lines (PIL) as it looks to expand its presence in emerging economies, according to the Wall Street Journal (WSJ).
Last week, COSCO bought Singamas, PIL’s container manufacturing subsidiary, for approximately US$565 million, and the WSJ believes the Chinese state-owned carrier is confident a deal for the entire business is possible.
PIL, the tenth largest carrier in the world, has a strong presence in Africa and deploys its ships largely in the trans-Pacific and north-south trade lanes.
Therefore, it could be a key link in Beijing’s Belt and Road Initiative (BRI), also known as the New Silk Road, a $1 trillion project to develop ports and supply chain infrastructure.
As it stands, the parties are not in formal negotiations, and PIL has repeatedly denied it is selling its shipping unit, despite suffering losses of $140 million in the first half of 2018.