Singapore's Neptune Orient Lines (NOL) refused comment on a French newspaper report that said merger talks were underway with Germany's biggest travel company TUI AG, which owns the container line, Hapag-Lloyd.
Sources told the French newspaper La Tribune that TUI would merge with its Hapag-Lloyd unit before raising capital and merging with NOL. Singapore's state-owned investment company Temasek Holdings, which owns 66 per cent of NOL, and would become the big shareholder in the new group, the paper said.
"Neptune Orient doesn't comment on rumours," NOL spokesman Paul Barrett told Bloomberg.
TUI chairman Michael Frenzel is negotiating a merger with Neptune Orient and has visited Singapore several times in recent weeks, reported La Tribune of France, citing a person close to shareholders.
Shipping giants such as AP Moeller-Maersk have recently consolidated to cut costs. AP Moeller bought Royal P&O Nedlloyd in 2005 and TUI's Hapag-Lloyd shipping unit bought Canada's CP Ships to become the world's fourth-largest container line.
La Tribune said a merger proposal would explain a financing move announced on January 9 by TUI, involving the sale of bonds exchangeable for part of its stake in TUI Travel to raise EUR450 million (US$665 million). Bloomberg also reported that a TUI spokesperson denied there were any negotiations afoot.
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