A.P. Moller – Maersk A/S (OTCMKTS: AMKBY), the world’s largest shipping firm, announced this week that it would split into two separate businesses, the transport & logistics division and energy division.
A.P. Moller–Maersk Group, a Danish business conglomerate, was controlled by its founding family through a foundation. The business was founded in 1904 from a steamship company.
After the split, Maersk Line will supervise the new transport & logistics division, while the company’s oil interests will be integrated into the energy division, which is the biggest change throughout the group’s history. Soren Skou will be still be the CEO of the whole group and head up transport & logistics division; Claus V. Hemmingsen will be vice CEO and the head up energy division. In addition, Trond Westlie, the original CFO, will be succeeded by Jakob Stausholm, who is the current lead Maersk Oil.
The new transport & logistics division will include four parts: Maersk Line, APM Terminals, Damco, Svitzer and Maersk Container Industry businesses. And for energy division, four parts will be included in this division: Maersk Oil, Maersk Drilling, Maersk Supply Service and Maersk Tankers. For the four businesses included in the energy unit, a decision of whether to remain the four parts as part of Maersk or split them will be made in the following two years.
For Maersk Oil business, the company said that it would focus on fewer areas, especially in the North Sea. The company planned to enhance business by mergers and acquisitions, and will keep exploration activities and expenses low.
“The industries in which we are operating are very different, and both face very different underlying fundamentals and competitive environments,” said Michael Pram Rasmussen, the chairman of the company. “Separating our transport and logistics businesses and our oil and oil related businesses into two independent divisions will enable both to focus on their respective markets.”
“I expect to see consolidation in the industry because many carriers haven’t made money for years and that can’t be can’t be sustainable in the long run,” said Soren Skou, Maersk group’s Chief Executive. “We will make sure we have strong capital and better utilization of assets so we have the fire power to do big things if opportunities come up.