The steady volume of large mergers and acquisitions that have taken place in the liner space over the past few years is tapering off as most medium-size to large takeover candidates have already been snapped up, a key executive said.
“Mergers and acquisitions are getting more challenging as there are fewer carriers available,” said Jeremy Nixon, chief executive of Singapore-based liner giant Ocean Network Express (ONE).
Nixon, who was speaking at the Capital Link Singapore Maritime Forum today, suggested the next round of mergers would centre on small, niche market operators.
These operators specialise in trades that, while profitable, have largely been ignored by the larger lines.
However, Nixon noted that the drive by liner players towards having a full global network is in part due to customers increasingly seeking one provider capable of giving global service.
ONE is itself the result of a merger of the liner operations of Japan’s three largest shipping companies, K Line, MOL and NYK Line.
The company launched in April last year. Nixon admitted its early days were quite challenging due to the complexities of bringing together three different companies and their respective cultures and work processes, as well as having to deal with multiple regulatory authorities.
But he claims those tough days are a thing of the past.
“We are up and running. We are stable, and we are operating normally”.
ONE was just one of a series of major liner company mergers to have taken place over the past few years that have also seen CMA CGM purchase NOL/APL, AP Moller-Maersk acquire Hamburg Sud, Hapag-Lloyd take over United Arab Shipping Co, and most recently, Cosco Shipping Holdings buying Orient Overseas Container Lines.
