Neptune Orient Lines (NOL) and TUI AG have appointed advisors for a potential merger between the Singaporean shipping line and TUI's container shipping arm Hapag Lloyd, the Asian Wall Street Journal reports.
According to the report, NOL has selected JP Morgan as its advisor for the potential business tie-up with TUI, while the German company has appointed Deutsche Bank.
Speculation erupted earlier this week about the rumoured NOL merger activity when CEO Thomas Held told the company's 2007 annual report webcast that NOL is prepared to play the role of an industry "consolidator".
Said Dr Held: "We do expect container shipping industry consolidation to continue. We are prepared to take an active role as a consolidator."
Veteran observers said this referred to reported merger plans of NOL's container arm, APL and Hapag Lloyd, owned by the German travel and shipping giant, TUI AG.
But to this Dr Held would only say: "It's our policy not to comment on market speculation and we never talk about individual candidates."
Since late January, there have been reports that a merger of the two is in the works, first prompted by appearances of TUI chief executive Michael Frenzel in Singapore.
Some say such a merger would work well because each market complements the other, with the deal enabling APL to have a substantial Asia/Europe offering while giving Hapag-Lloyd access to the transpacific and the rapidly growing intra-Asia trade.
Others say such a deal would make it hard for Hapag Lloyd to stay in the Grand Alliance with partners MISC, NYK and OOCL, or for APL to continue to work with its New World Alliance partners, Hyundai and MOL.
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