Lloyd's List Intelligence reports that rating agency Standard & Poors said that French container line CMA CGM’s liquidity position will be “constrained in the coming quarters if it cannot bolster its liquidity sources” by selling assets or changing the payback terms on its debt.
Standard & Poors downgraded France’s largest container line, and world number three, to B- from B+ and “weak” and placed these ratings on its CreditWatch Negative status, meaning that it could downgrade further unless the company moved to improve its debt position, facing loan covenant breaches.
The ratings downgrade follows CMA CGM’s net loss of US$30-million for 2011, despite one-time gains on the sale of 50% of Malta Freeport to Turkish industrialist Robert Yildrim, who has also invested in CMA CGM.
“We believe that CMA CGM’s cashflow generation will remain limited, thereby eroding its liquidity position,” unless it sells assets or changes debt terms, S&P said in a statement.
