CMA CGM said in talks to buy Singapore’s Neptune Orient Lines

France’s CMA CGM SA is in talks to acquire Singapore container shipping company Neptune Orient Lines Ltd., as majority owner Temasek Holdings Pte seeks a buyer, people with knowledge of the matter have been reported as saying.

CMA CGM was said to have made a preliminary offer for NOL, which has a market value of S$2.7 billion (USD1.9 billion), two of the people said, asking not to be identified as the information is private.

Marseille-based CMA CGM is now conducting due diligence, though it hasn’t been granted exclusivity, according to one of the people.

Denmark’s A.P. Moeller-Maersk A/S is also in talks about an acquisition of NOL, though the discussions are less advanced, the people said.

A deal is unlikely to be struck soon, as the slumping shipping sector damps the appetite for aggressive bidding, two of the people said. Temasek, the Singapore state investment company that owns 67 percent of NOL, may not be willing sell its stake at a low price, they said.

Representatives for CMA CGM, NOL and Temasek declined to comment.

“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 said in a phone interview Friday, declining to comment specifically on whether Maersk is looking at NOL. “In general we welcome any consolidation — that would only be healthy for the container line industry.”

NOL gained 6.6 percent to close at S$1.05 in Singapore trading. Maersk shares rose 2.4 percent in Copenhagen Friday.

The shipping company that helped cement Singapore’s status as a global trade hub is attracting takeover interest after simplifying its structure earlier this year by selling its $1.2 billion logistics unit. NOL, created in 1968 and now Southeast Asia’s largest container line, ran up $1.2 billion of losses in the last four financial years as sluggish global commerce and overcapacity ate into shipping rates.

Copyright Ships & Ports Ltd. Permission to use quotations from this article is granted subject to appropriate credit given to as the source.