Maersk Still Willing to Consider NOL, Other Acquisitions

Soren Toft says it is "always looking at opportunities for consolidating."

If acquisition talks between Neptune Orient Lines (NOL) and CMA CGM fail to progress, Maersk Line says negotiations with the Singaporean company could resume, Singaporean media reports.

As Ship & Bunker previously reported, NOL has given CMA CGM until December 7 to "negotiate the definitive agreements to be entered in relation to the offer."

NOL had previously been in preliminary acquisition discussions with both CMA CGM and Maersk, but recently it disclosed it moved into exclusive talks with the French group.

Soren Toft, chief operating officer for Maersk's Liner business, told a media roundtable that if the discussions fail, "It depends on the conditions, that's for sure, but you have to look at it as 'if there's a viable deal space, we will of course look into it'."

He declined to comment on what compelled NOL to enter into exclusive talks with CMA CGM "other than to say we have been in discussions … But generally, we're always looking at opportunities for consolidating."

Toft added that any acquisition would result in enhancing synergies rather than the "irrational, mindless pursuit of expansion."

The Maersk executive also stated that "This industry is in need of consolidation to the extent that if it makes sense for us to participate, then we will do so."

In other matters, Toft predicted that freight rates will continue on a "slow erosion" path in 2016, and although Maersk is staying on course to reduce costs in part by slashing 4,000 jobs globally, he declined to disclose how many would be lost in Singapore other than to say the losses would be mostly shore-based and not concentrated in any single region.

Bankers and industry analysts have gone on record as stating that with a price of about $2 billion, acquisition of NOL would offer any buyer “a modern fleet at a comparative bargain price."