Shipping and logistics company Neptune Orient Lines (NOL) has sold APL Logistics to Kintetsu World Express (KWE) for US$1.2bn.
The Singapore-based group announced the deal on 17 February, just as NOL recorded its fourth consecutive year of losses, posting a net loss of US$260m in 2014.
President and CEO of NOL Ng Yat Chung said the sale was a strategic move that would allow NOL to focus on improving its container shipping business, APL.
“The transaction will also strengthen our balance sheet and unlock value for our shareholders,” said Ng in a company statement. "The proposed transaction with KWE is expected to provide APL Logistics with the opportunity to expand its business with the backing of a company with strong fundamentals and a commitment to grow in the logistics space. We believe that KWE has the ability and the ambition to continue APL Logistics’ growth strategy."
Although the sale process is unclear, NOL said the agreement was made with the Japanese freight carrier following a “robust and highly competitive process”.
“Since 2013, we have laid out a strategy to strengthen our international presence especially in the US and Asia. This transaction fits right into our strategy,” said Satoshi Ishizaki, president and CEO of KWE, adding that the APL Logistics headquarters will remain in Singapore.
The deal is subject to shareholder and regulatory approval.