NOL’s share price jumps as takeover talks gain traction

Temasek wants to divest the loss-making firm.

Investors snapped up shares of Neptune Orient Lines (NOL) in early Monday trading after the container shipping firm confirmed that it is in talks for a possible acquisition by France’s CMA CGM SA and Denmark’s A.P. Moeller-Maersk A/S.

NOL’s share price surged by as much as 8% to $1.125 early Monday, before dropping to $1.085 by around 10 am. This still represents a 4% gain compared to its closing price of $1.045 on Friday.

NOL confirmed on November 7 that it is in preliminary talks with both parties but said that there is no assurance that the discussions will result in a deal.

“NOL has a duty to assess all options to maximise shareholder value and improve its competitiveness. From time to time, NOL enters into discussions on possible combinations involving NOL, while remaining focused on returning its core liner business to sustainable growth and profitability,” NOL said in a statement.

Earlier this year, it was reported that Temasek is looking to divest its majority stake in NOL, which has been consistently in the red for several years.

“NOL will make an appropriate announcement in the event that there are any material developments. Shareholders of NOL and investors are therefore advised to exercise caution when dealing in shares in and other securities of NOL,” the statement added.