Specializing in International Freight Forwarding, by way of ocean, air, rail and truck freight-RISINGSUN

UASC emerges afront-runner to acquire lose-making NOL's fleet & 2.8pc market share

Time：2015-08-05 Browse：195 Author：RISINGSUN

UNITED Arab Shipping Company (UASC) has been singled out as a leading potential buyer of loss-making container shipping line, Singapore`s Neptune Orient Lines (NOL), which is to be sold by the state investor Temasek Holdings for a US$2 billion asking price, well below its market value due to the timing of the sale.

According to analysts, the carrier has lost $1 billion in the past four years amid a downturn in global trade, persistently weak freight rates, with Asia-Europe spot rates at six-year lows, and serious overcapacity with the on-going stream of mega vessels joining the world fleet to realize greater economies of scale.

NOL has a modern fleet and commands a 2.8 per cent market share of the global box shipping trade, according to media reports.

The global shipping sector`s debt has doubled to $86 billion over the past decade, Singapore director of Drewry Equity Research, Rahul Kapoor, told Reuters.

Industry sources say Germany`s Hapag-Lloyd and Hamburg Sud are also looking to acquire NOL.