By Joyce Koh, Jonathan Browning and Aaron Kirchfeld

(Bloomberg) — Neptune Orient Lines Ltd. stated it’s in separate talks with France’s CMA CGM SA and Denmark’s A.P. Moeller-Maersk A/S on a possible sale of the Singapore container transport firm.

“NOL has a duty to assess all options to maximize shareholder value and improve its competitiveness,” the corporate stated in an announcement to the Singapore inventory change Saturday, including that the discussions are preliminary and there’s no assurance {that a} definitive settlement shall be reached.

CMA CGM has made a preliminary supply for Neptune Orient, which has a market worth of S$2.7 billion ($1.9 billion), individuals with the data stated earlier, asking to not be recognized as the data is non-public. Marseille-based CMA CGM is now conducting due diligence, although it hasn’t been granted exclusivity, based on one of many individuals. Maersk can also be in talks about an acquisition of Neptune Orient, although the discussions are much less superior, the individuals stated.

Unlikely Deal

A deal is unlikely to be struck quickly, because the slumping transport sector damps the urge for food for aggressive bidding, two of the individuals stated. Temasek Holdings Pte, the Singapore state funding firm that owns 67 % of Neptune Orient, might not be keen promote its stake at a low value, they stated.

The transport firm that helped cement Singapore’s standing as a world commerce hub is attracting takeover curiosity after simplifying its construction earlier this yr by promoting its $1.2 billion logistics unit. Neptune Orient, created in 1968 and now Southeast Asia’s largest container line, ran up $1.2 billion of losses within the final 4 monetary years as sluggish international commerce and overcapacity ate into transport charges.

Neptune Orient gained 6.6 % to S$1.045 in Singapore buying and selling Friday. Maersk shares rose 2.4 % on the shut in Copenhagen.

Acquiring Neptune Orient would assist consolidate CMA CGM’s No. 3 place in container transport because it competes with market leaders Maersk and Mediterranean Shipping Co. Neptune Orient’s APL container unit has a 2.7 % market share, whereas CMA CGM controls 8.9 % of the market, based on information from business guide Alphaliner.

‘Look at Everything’

CMA CGM, based in 1978, has a fleet of 467 vessels transporting 12.1 million twenty-foot equal models of cargo yearly, based on its web site. Representatives for CMA CGM, Neptune Orient and Temasek declined to remark.

“We’ve always said that we will look at everything that comes up for sale in the market but our base strategy is to grow organically,” Maersk Chief Executive Officer Nils Smedegaard Andersen stated in a telephone interview Friday, declining to remark particularly on whether or not Maersk is Neptune Orient. “In general we welcome any consolidation — that would only be healthy for the container line industry.”

Hapag-Lloyd AG, Germany’s largest transport line that began buying and selling on the Frankfurt inventory change on Friday, has repeatedly flirted with the concept of teaming up with Neptune Orient. Billionaire stakeholder Klaus-Michael Kuehne stated in an interview, which ran in Swiss newspaper Finanz & Wirtschaft in June, that combining the 2 firms could be “interesting,” although a problem as Neptune Orient is “not in good shape.”

Shares in Hapag-Lloyd, the world’s No. 5 provider, gained 1.5 % on their debut Friday, giving it a market capitalization of two.4 billion euros ($2.5 billion).

Kintetsu World Express Inc. earlier this yr purchased Neptune Orient’s APL Logistics Ltd. for 144.2 billion yen ($1.2 billion) to assist the Japanese firm broaden its income base. Neptune Orient, which has bought its principal workplace constructing and a few vessels amid 4 consecutive years of losses, disposed the logistics unit to take out money and concentrate on boosting its container-line enterprise.

–With help from Klaus Wille and Kyunghee Park in Singapore, Francois de Beaupuy in Paris, Christian Wienberg in Copenhagen and Nicholas Brautlecht in Hamburg.

©2015 Bloomberg News

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