Advertisement
X

Maersk to spin off energy operations

Copenhagen - Rocked by low freight and oil prices, Denmark's AP Moller-Maersk will split into separate transport and energy divisions under a keenly-anticipated revamp announced on Thursday.

The 112-year-old conglomerate will focus on its core transport and logistics businesses, comprising Maersk Line, APM Terminals, Damco, Svitzer and Maersk Container Industry.

File picture: Michael Kooren. Credit: REUTERS

It said it would look for solutions for its oil and oil-related businesses within 24 months. They are to be separated from the main company either individually or in combination “in the form of joint-ventures, mergers or listing”.

Maersk Line chief executive Soren Skou, promoted to CEO of the entire company in June, will lead the restructuring and the company has appointed a new group chief financial officer, Jakob Stausholm, effective from 1 December.

“Separating our transport and logistics businesses and our oil and oil related businesses into two independent divisions will enable both to focus on their respective markets,” Chairman Michael Pram Rasmussen said in a statement.

“Both face very different underlying fundamentals and competitive environments.”

Maersk Line, the world's biggest container shipping business, is suffering from record low freight rates as growth in global trade has failed to keep pace with a big expansion in shipping fleets.

Meanwhile, the group's oil business is struggling with a 60 percent drop in crude prices since mid-2014.

In August, the group posted a second-quarter net profit of $101 million, lagging the $196 million expected by analysts.

Maersk shares have risen more than 20 percent since June in ahead of the company's strategic review.

At 07h18 GMT, the shares were trading up 3.2 percent at 10220 crowns.

The group, controlled by the Maersk family, was founded in 1904 by AP Moller and was turned into a conglomerate operating in 130 countries by his son, Maersk Mc-Kinney Moller, who had an active role in the company until he died in 2012 aged 98.

SHOW ALL
Advertisement