CMA CGM Confirms Plans for Further Acquisitions Following Santos Brasil Deal

CMA CGM has announced plans to pursue further acquisitions, despite the looming prospect of higher taxes on large companies in its home market, as the French shipping giant revealed a $1.1 billion investment in a Brazilian port terminal operator.

With ample cash reserves, CMA CGM, the world’s third-largest shipping group, has been expanding into new sectors, including logistics and media. On Monday, it confirmed an agreement to acquire a 48% stake in Santos Brasil, aiming to gain full control of the company.

The deal follows a period of significant growth for CMA CGM, which has drawn political attention in France, including from the far right. Marine Le Pen’s Rassemblement National party campaigned to end tax exemptions for shipping groups ahead of the recent French elections, while newly-appointed Prime Minister Michel Barnier hinted at potential levies on large corporations to address the country’s strained public finances.

Rodolphe Saadé, CEO of the Marseille-based CMA CGM, emphasized the company’s long-term growth ambitions, noting that if necessary, it would comply with any windfall taxes imposed in France.

“We are a family business, and we are focused on the long term,” Saadé told reporters following the Brazilian deal. CMA CGM will acquire an initial stake in Santos Brasil, which operates the largest container terminal in South America, located at the Port of Santos, before launching a public tender offer for the remaining shares. The total transaction will exceed $2 billion.

“I understand the political challenges in France, but our goal is the future—long-term investment,” Saadé added. “If the government decides there will be an exceptional contribution from large companies in France, we will do our part.”

However, he warned that any changes to France’s tonnage tax system would be detrimental, noting that CMA CGM’s rivals in Denmark and Switzerland benefit from similarly favorable regimes.

“If France chooses to alter this, it will put us at a disadvantage compared to our European competitors,” Saadé said.

The tonnage tax system, based on the net tonnage of a company’s fleet, helps shield shipping companies during volatile periods of reduced demand. It is also advantageous as it typically results in lower tax rates than standard corporate taxes.

Saadé reiterated that his goal for CMA CGM is to “continue growing the company,” including through acquisitions when opportunities arise. The group has recently expanded into media by acquiring the TV channel BFM earlier this year, further establishing Saadé’s position as one of France’s shipping industry billionaires. Logistics has also become an increasingly significant part of CMA CGM’s portfolio and profits.

The Brazilian deal will give CMA CGM access to three container terminals in addition to other assets.

Although freight rates have fallen from the peaks seen during the COVID-19 pandemic—when shipping companies experienced a boom—this year’s disruptions in the Red Sea shipping lanes have kept rates elevated, with demand remaining strong.

Saadé cautioned that 2025 could be more challenging for the shipping industry, as a surge of new ship deliveries is expected to increase capacity, potentially outpacing demand. “2025 will be tougher, but not because the global economy is slowing down,” he said.

Source: Valor Econômico

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