Trans-national Maritime Mergers and US Security/Subsidy Programs: What’s a National Security Asset to Do?

by C. Jonathan Benner

The late twentieth century is a time of general industrial consolidation. The maritime industry is no exception to this trend. In the liner trades, we have seen traditional conference mechanisms falter and give way to a transitional period of contractual “alliances” between carriers. These alliances, in turn, have yielded to a series of outright mergers. The latter process appears to be in full cry and is likely to be the dominant structural dynamic of the liner trades in what little time remains to the century.

For purposes of this article we can focus on three major consolidations. P&O and Nedlloyd merged in late 1996. Canadian Pacific Ltd. is attempting to finalize a takeover arrangement for an acquisition of Lykes Bros. Steamship Co. Neptune Orient Lines and APL are seeking necessary U.S. approvals for an acquisition of APL shares by NOL.

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