Tuesday, April 6, 2010

CEO: Maersk May Sell some Units, Buy other Firms in 2010

After suffering its first annual loss since World War II, Transportation giant A.P. Moeller-Maersk, may be looking toward selling off some less profitable business units while acquiring others during 2010, according to Chief Executive Nils Smedegaard Andersen, quoted in Monday’s Maersk Post, the company’s company newsletter.

Andersen made it clear that the Danish firm, parent to the world's largest container carrier Maersk Line, has moved well away from "survival mode" and is now looking at becoming more competitive. "I hope we will be able to make an interesting acquisition or buy some distressed assets," Andersen said through the newsletter. Anderson favors acquisitions for the firm's oil and gas exploration division and its port operations unit. 

However, the firm is still planning to cut another $500 million in costs this year, bringing total announced spending reductions by the firm since last year to $2.5 billion. The firm reported a $1.29 billion net loss in 2009, the first in more than 60 years for the 105-year-old conglomerate. Andersen said the firm may sell off some of its less profitable assets as part of the overall cost cutting plan. 

Despite the cost cutting, Andersen said he believes that A.P. Moeller-Maersk is poised to have a "reasonable result" by year's end due to the firm's ability to turn a "far better profit" in 2010 than its competitors.

Andersen said that following the already extensive cost-cutting measures already taken, the firm will have to look at "fruits that hang higher" and for "smaller items and areas" to achieve the needed cuts this year.