MSC Moves to Buy Majority Stake in Brazilian Carrier Log-In Logistica
Number-two container carrier MSC has lodged a bid to purchase a controlling stake in Brazilian domestic carrier Log-In Logistica.
Log-In is a publicly-listed feeder operator with a focus on coastwise trade. It also operates one container terminal, the Vila Velha Terminal (TVV) in the state of Espírito Santo. It has seen a 20 percent growth in volume over the past six years, and it has recently expanded from its home market in Brazil to serve new customers in Argentina.
The company operates seven container feeders of between 1,700 and 2,800 TEU in size - a portfolio that has suddenly become quite valuable in today's overheated boxship market. Ocean carriers are snapping up every available vessel to meet soaring demand for ocean freight, including the smallest classes of boxships.
Under the leadership of recently-appointed CEO Soren Toft, MSC has gone on an unprecedented buying spree for used tonnage. According to Alphaliner, the line has acquired 109 vessels in the span of a year, and it shows no signs of stopping. In its rush to grow its fleet and capture today's sky-high rates, MSC has aggressively pursued older and smaller tonnage. It recently paid $60 million each for a set of 15-year-old Panamaxes, and it is "particularly keen" on buying feeder ships, one broker told The Loadstar.
MSC has asked Brazil's competition regulator, the Administrative Council for Economic Defense (CADE), for permission to purchase up to 67 percent of Log-In's shares. The acquisition would happen through a public auction process, and MSC says that it would tender an initial offering price of $4.73 per share - a 67 percent premium over Log-In's share price last week. Log-In's shares rose sharply after the announcement and are now trading in the range of $4, reflecting investor confidence that the deal will be approved.
"[Log-In] will analyze the content of said [offer], as well as its obligations in relation to the offer intended, and will keep the market informed of the relevant developments," the company said in a brief statement.
Brazilian asset management firm Alaska Investimentos Ltda., which holds a stake in Log-In through several investment vehicles, said Friday that it has accepted the terms of MSC's proposal.