Lloyd’s List’s Monday issue, to be distributed at CMA profiles France’s Philippe Louis-Dreyfus, the CMA Commodore, who accepts his award on Wednesday night. He spoke about his passion for shipping, but also on media speculation that the Louis Dreyfus group is one of the outside investors looking to inject fresh capital in CMA CGM. Read on …….

Philippe Louis-Dreyfus

Shipping needs passion ‘from the heart and from the gut’

Michelle Wiese Bockmann – Friday 19 March 2010

A PROUD and patriotic Frenchman with a passion for shipping, Philippe Louis-Dreyfus owns one of his country’s last remaining international maritime companies. 

The former merchant banker bought Louis Dreyfus Armateurs, the shipping division of the family-owned, 159-year-old commodities giant Louis Dreyfus Group, in late 2007, because he was concerned that a Swiss cousin would move the maritime headquarters to Switzerland. 

Now his patriotism may be tested further. The Louis Dreyfus Group, in which he remains a shareholder and board director, is one of the last hopes for struggling French container line CMA CGM as it seeks fresh capital to stay afloat. 

The group is one of a series of private investors and hedge funds talking to CMA CGM, as the world’s third-largest container line, also family-owned, undergoes a painful restructuring of its $5.6bn debt. 

“As a French company, as a French group, but also as a person who has dedicated a lot of time and effort to the French shipping network and to promote French shipping, I do not believe that I can be totally neutral and see a fine company like CMA CGM go through real difficulties,” Mr Louis-Dreyfus says.
Any eventual involvement with Louis Dreyfus would include the commodities side of the group and Louis Dreyfus 

Armateurs, where shipping expertise lies, Mr Louis-Dreyfus says. 

“It is a fine group,” he says of CMA CGM, “with very good operating teams, and I believe one should try to help it through its problems. This is one reason for us to look at that file. 

“At this stage, we do not have a clear enough view of the company’s situation and of its immediate future.” 

This week Mr Louis-Dreyfus travels to the US to receive a prestigious maritime industry accolade — the Connecticut Maritime Association Commodore award, to honour those who have made an outstanding contribution to global shipping. 

The highly political and very sensitive debate in France over CMA CGM’s future should not overshadow Mr Louis-Dreyfus’ already significant achievements. 

Since returning to the family group to run the shipping business in 1997, he has served as president of the European Community Shipowners’ Association, and the French equivalent, and has held board positions with French classification society Bureau Veritas and the UK P&I Club. 

He has deeply reorganised Louis Dreyfus Armateurs over the past decade, with an emphasis on quality industrial shipping. The company’s 2008 revenue was €88m ($120m), half coming from diversified companies aside from dry bulk transportation, such as seismic and cable-laying service vessels, as well as logistics and port infrastructure provision in countries such as Brazil and Indonesia. 

“I am dedicated to support my country and its industrial activities, like shipping, in France, which is not always easy. [It is] quite costly, but it has rewards of another kind,” Mr Louis-Dreyfus says. 

His most recent expansion in Asia, a December 2009 joint venture with Seroja Investments, is now looking to buy secondhand or new vessels, to ship palm oil, coal and agricultural commodities from Indonesia, building on a growing presence in port infrastructure and logistics there. 

Since deciding to go independent, Louis Dreyfus Armateurs has also bought Dutch-based Fairmont Marine, which specialises in long distance towing of floating production, storage and offloading units and semi-submersible drilling rigs. The company has also refreshed its dry bulk and ro-ro fleet. 

Four Japanese bulk carriers have been delivered with long-term charterers to subsidiary Cetragpa over the last 14 months, bringing the fleet to 20 bulkers. 

Interestingly, Cetragpa “very seldom” gets business from the commodities side of the group, despite their close history, and has not counted on covering in-house transport needs for the last 60-70 years, Mr Louis-Dreyfus says. 

Other newbuilding additions last year included two Singapore-built ro-ros for ferry subsidiary LD Lines, with a further ro-pax vessel to be delivered this year. 

Underscoring all company developments is a self-confessed shipping passion, which has been part of the family for five generations. 

“I love shipping. I am interested in shipping and it makes me excited and happy, and you need that in shipping,” Mr Louis Dreyfus says. “I was a banker for 20 years, and it is the most intellectually exciting thing to do. But shipping also also very exciting intellectually, but it needs something different — another scale of passion, from the heart and the gut.” 

Which leads back to CMA CGM. Will the head or the gut be deployed to save France’s last container line? Investors reportedly had until March 17 to decide whether to participate in any cash injection, needed so CMA CGM can access a $500m loan facility. If France’s Strategic Investment Fund agrees to invest, will the Louis Dreyfus Group? 

Mr Louis-Dreyfus does not want to answer specifically. “More generally, I am going to say that if a solution is to be found, it should involve at the same time private money, financial investors and public support — which does not automatically mean public money,” he says. 

“I do not see how things could happen or occur differently. I hope that things will go in the right direction and that the people involved will be wise and look at the situation in the eyes. [I hope] they will accept sacrifices that will not be easy but are very much needed to attract outside investors, allowing the company to get back to business as normal.” 

So as Mr Louis-Dreyfus steps on the podium on Wednesday night to accept the traditional commodore’s hat that comes with the award, he carries the future of French shipping on his shoulders. 

Whether he will pad his biography with a CMA CGM postscript has yet to emerge.