P&O is to pull out of its container shipping joint venture with Royal Nedlloyd in a transaction that will create a new independent container shipping line.
P&O has announced it will dispose of its 50 per cent stake in the joint venture to Nedlloyd for £149.8 million cash and a 25 per cent stake in a new company to be called Royal P&O Nedlloyd.
Royal Nedlloyd will partly pay P&O for its stake in the joint venture with a 190 million euros rights issue in April. P&O’s chairman Lord Sterling of Plaistow, said: “This is the deal we’ve been waiting for, it’s a strategic move. We’re still a 25 per cent shareholder but it’s not a core holding and, as time goes on, we would obviously go lower or out completely. But I’m not commenting on that now.”
Philip Green, the newly appointed chief executive of Royal P&O Lloyd, said he is concerned about improving the business. He said: “World containerised trade is expected to grow by eight or nine per cent in 2004. We believe we are set for strong trade growth with the increasing importance of China.”