Supported from the French government, CMA CGM landed a loan facility worth $1.1 billion, giving it more cash on hand as it struggles with the global decline in containerized cargo due to COVID-19.
BNP Paribas, HSBC, and Société Générale provided the loan to the shipping company, with a guarantee through the French government’s COVID-19 financial rescue package. It is stated that the guarantee covers 70% of the one-year loan facility.
Due to the crisis arising from the COVID-19, the company deals with headwinds due to falling demand. In the meantime, they forecast a 10% drop in the first six months of the year; even this sudden fall is more optimistic than Maersk’s prediction of a 25% drop in volume in the second quarter.
Rodolphe Saadé, chairman and CEO of the CMA CGM Group commented that
I would like to thank the French authorities for having introduced this scheme so effectively and quickly. This loan also shows the confidence our banking partners have in the CMA CGM Group’s business model and strategy.
Overall, the company was facing difficulties from the start of the year, when they posted a full-year loss in 2019, driven in part by substantial loan interest obligations.
