With backing from the French government, CMA CGM has landed a loan facility worth $1.1 billion, giving it more cash on hand as it struggles with the global decline in containerized cargo due to COVID-19.

The loan was provided by BNP Paribas, HSBC, and Société Générale, with a guarantee provided through the French government's COVID-19 financial rescue package. The guarantee covers 70 percent of the one-year loan facility.

“I would like to thank the French authorities for having introduced this scheme so effectively and quickly,” said Rodolphe Saadé, chairman and CEO of the CMA CGM Group. “This loan also shows the confidence our banking partners have in the CMA CGM Group's business model and strategy.”

CMA CGM faces significant headwinds due to falling demand. Its forecast calls for a ten percent drop in the first six months of the year; even this sudden fall is more optimistic than Maersk's prediction of a 25 percent drop in volume in the second quarter.

CMA CGM's balance sheet was already in less than optimal shape at the start of the year. The company posted a full-year loss in 2019, driven in part by substantial loan interest obligations. It announced a $1.2 billion cost-cutting drive in early 2019, and in November, it agreed on a deal to sell 10 of its port terminals to its joint venture with China Merchants Port Holdings (CMPort). It completed the sale of eight out of 10 in March, including its PSA Lion Terminal in Singapore and is Rotterdam World Gateway terminal in the Netherlands.

These asset sales are part of a broader $2.1 billion liquidity plan, which is aimed at reducing the company's $18 billion debt burden (as of year-end 2019).