P&O will continue operations in the U.S. until all concerns are resolved. The worst-case scenario is that DP World would be forced to divest the U.S. assets, but that would not affect investors, who would have already received their money, or the overall takeover, which centered on P&O's business in Asia rather than the U.S., analysts said. Asian ports comprise about half of P&O's assets.
According to P&O's annual report in 2004, the latest available, operating profits from Asian ports totaled £84.6 million compared with £16.2 million for American ports.
"The expectation is that the company will pay (investors) any day now," said Peter Schoenfeld, founder of P. Schoenfeld Asset Management, New York. "They're prepared to shake off all the U.S. issues, even if it means ultimately divesting the U.S. ports. They're anxious to get control of this company for the more valuable locations."
P&O stock trading volumes were "way above average" a few days before the senators announced their opposition, said John Orrico, fund manager for The Arbitrage Fund, New York, who was trading P&O stock. Prices remained stable, closing between 513.25 pence on Feb. 20 and as high as 519 pence on March 2. This is because investors didn't think the U.S. assets were crucial to the deal, analysts said.
Another reason for the stable pricing was DP World itself, which was purchasing P&O stocks at a discount in the open market.
Public records indicate that between Feb. 20 and March 1, DP World had increased its stake in P&O from 4.67% to 18.52% through its investment arm Thunder FZE and brokered by Deutsche Bank AG, Frankfurt.
"It has pretty much been approved," said London-based analyst Menno Sanderse of Morgan Stanley, which acted as corporate broker for P&O. "It's now all down to President Bush."