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1 Subscription copy for Capital Link. Sent to Unauthorised re-distribution prohibited** The full newsletter is available by subscription. Please contact ** Chart of the week liner consolidation still not in sight The liner shipping industry is unlikely to see much consolidation in the foresee-able future despite the carriers present financial difficulties. Since the last wave of liner company mergers and acquisitions in 2005-2007, none of the Top 20 carriers have been involved in any M&A activity. There remain signifi-cant barriers to consolidation, acting as deterrents to carriers which would con-sider M&A moves in the near term. Proponents of consolidation suggest that larger and more cost-efficient carriers could derive economies of scale which will drive smaller players from main liner markets. This has so far remained elusive. Smaller carriers such as Wan Hai and OOCL have consistently outperformed their larger competitors financially, which refutes the view that larger operators are necessarily more profitable.

2 Recent corporate moves involving the main carriers have centered on the injec-tion of new capital from non-operating investors. This started with the Albert Ballin group investing into Hapag-Lloyd in 2008, followed by Yildirim s invest-ment in CMA CGM (2010) and Qui enco investing in CSAV (2011). This trend is expected to continue, with reports suggesting that the French sovereign invest-ment fund Fonds Strat gique d'Investissement (FSI) is considering a 150 M ($195 M) investment in CMA CGM. While these injections of fresh capital have provided the carriers with much ALPHALINER Weekly Newsletter is distributed every Monday. The newsletter is available upon subscription. Information is given in good faith but without guarantee. Please send your feedback, comments and questions to ALPHALINER Weekly Newsletter to Volume 2012 Issue 41 Web: | E-mail: | Sales: INSIDE THIS ISSUE:INSIDE THIS ISSUE:INSIDE THIS ISSUE:INSIDE THIS ISSUE.

3 Consolidation remains remoteConsolidation remains remoteConsolidation remains remoteConsolidation remains remote 1111 Corporate UpdatesCorporate UpdatesCorporate UpdatesCorporate Updates Samoan government acquires PFL 4444 Service Updates Service Updates Service Updates Service Updates G6 to cover Goteborg with sea-sonal feeder Arkas and Evergreen to launch Italy-Libya service MOL to adds third West Africa relay loop Maersk adds feeder loop at JWP OOCL revises Baltic feeder loops UASC relaunches HCMC dedi-cated feeder RCL adds Straits-Taiwan service MSC and Zim organize joint US Gulf feeder loop MOL/Samudera to merge KPX/NCX Pacific Direct Line to add new South Pacific loop 5555 Delivery/New Order UpdatesDelivery/New Order UpdatesDelivery/New Order UpdatesDelivery/New Order Updates October Deliveries 8888 Terminal UpdatesTerminal UpdatesTerminal UpdatesTerminal Updates UK ports record volume decline in 2011 10101010 Readers are reminded that unauthorized redistribution of the newsletter is prohib-ited and are requested to quote ALPHALINER as source for all data derived from the newsletter.

4 Please refer to our full user terms and copyrights at Principal liner M&A activity since 1995 (by capacity operated of companies acquired) 0100,000200,000300,000400,000500,000600, 000700,000800,000 Acquired companies TEU Capacity Operated Financial BuyersTrade Buyers1997: Preussag acquires Hapag-Lloyd NOL acquires APL CP Ships acquires Contship 1998: Evergreen acquires Lloyd Triestino 1999: Maersk acquires Safmarine & Sea-Land 2000: CSAV acquires Norasia 2002: CP Ships acquires Italia/D Amico 2003: Carlyle acquires CSX Lines d acquires Kien Hung 2004: Castle Harlan acquires Horizon Lines 2005: Maersk acquires P&O Nedlloyd Hapag-Lloyd acquires CP Ships CMA CGM acquires Delmas 2007: Montagu acquires Unifeeder Ham S d acquires Costa CMA CGM acquires CNC 2008: Albert Ballin acquires shares in H-L 2011: Qui enco acquires shares in CSAV 2010: Yildirim acquires shares in CMA CGM Principal transactions : ALPHALINER Barriers to consolidation:- Buyers have limited access to funding, with the majority of carriers balance sheets over-stretched; Significant write-downs on the book value of vessels are required; Cheaper route for expan-sion by buying ships or ordering new ships than to acquire existing company; Vessel sharing alliances allow carriers to achieve operating synergies without giving up control; Poor precedents of merger benefits including loss of market share; Political and cultural obsta-cles to cross-country merg-ers; Lack of political will to force through the mergers of Chinese, Japanese and Korean liner operators.

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