Maersk sells $1b in U.S. bond offering

The Danish shipping conglomerate has also begun a program to buy back $1 billion in company shares over the next year.    A.P. Møller – Mærsk A/S, the conglomerate whose holdings include Maersk Line and APM Terminals, said this week it has sold $1 billion in bonds in the U.S. with net proceeds to be used for “general corporate purposes.”
   The bonds were sold in two tranches, $500 million due in September 2020 with a coupon rate of 2.875 percent, and $500 million due in September 2025 with a coupon rate of 3.875 percent.
   The company said it expects both both tranches to be rated BBB+ by Standard & Poor’s and Baa1 by Moody’s.
   This is Maersk’s second bond offering in the U.S. In 2014, it placed $1.25 billion in bonds in the U.S.
   The bond sale comes on the heels of an August 31 announcement about the first phase of a program to buy back up to 6.7 billion Danish kroner (U.S. $1 billion at today’s exchange rates) of shares over the next year. The first phase of the program will run from Sept. 1 to Nov. 30 and the shares to be acquired will be limited to a total market value of 2.3 billion Danish Kroner.
   Maersk said the purpose of the share buyback is to “adjust the capital structure of the company” and was authorized by its board of directors at the company’s annual meeting earlier this year. Maersk has two classes of stock and it said A and B shares will be acquired in a 20/80 split reflecting the current trading volumes of the two share classes.
   The company said the board authorized the acquisition of treasury shares at a nominal value “not exceeding 10 percent of the share capital at the market price applicable at the time of acquisition with a deviation of up to 10 percent.”
   A maximum of 56,250 A shares and 225,000 B shares can be acquired in the first phase of the buy-back program. Through the end of last week the company had acquired 9,406 A shares and 37,051 B shares.
   Prior to the share buy-back, the conglomerate held 85,252 B shares, equal to 0.4 percent of the share capital.
   While Maersk’s website says it has approximately 83,000 shareholders, the company is largely owned by foundations and funds, three of which own about 53 percent of the company’s shares and 70 percent of its stock. The largest holding, A.P. Moller Holding, is a subsidiary of a Danish foundation. It has a 41.5 percent stake and controls over 51 percent of the votes in the conglomerate.