Date: Monday, January 4, 2021
Source: Lloyd's List
ISRAELI container carrier Zim has filed for an initial public offering on the mainboard of the New York Stock Exchange, aiming to raise up to $100m from its fourth bid at going public.
Zim, which counts Idan Ofer’s investment vehicle Kenon Holdings as a key shareholder, has made three unsuccessful attempts previously in 2008, 2011 and 2016, to go public.
Its fourth IPO bid came just weeks after it posted a record quarterly net profit of $144.4m for the three months ended September 30 as container freight rates surged to new highs.
If the fourth time proves to be a charm for the Israeli carrier, it will be the second container shipping play after Matson to trade on NYSE’s main board.
News of Zim’s IPO bid first broke in September, when the carrier first put in a preliminary regulatory filing.
Drewry flagged the possibility of this latest public listing bid being directed by Idan Ofer-controlled Kenon Holdings.
Pointing to previous divestments by Kenon Holdings, Drewry also suggested that the investment vehicle may well ride on the IPO to offload its stake in Zim, which has been a loss-making entity for years until recently.
Rated the world’s tenth largest container line by Alphaliner, Zim had more than a third of its shipping capacity deployed on the transpacific trade over the nine months to September 30.
The asset-light carrier, which chartered in more than 90% of its operating fleet as of September 30, has a standing slot-sharing arrangement with the 2M alliance, namely, Maersk and Mediterranean Shipping Co, the lodged IPO prospectus said.
Noting that Maersk has cut a planned mid-September general rate increase, Drewry has suggested that regulatory controls may hold back the rally in container freight rates.
Maersk’s move followed on from calls from Chinese authorities to container lines, arguing for savings from lower bunkering costs and port fees to be passed on shippers.
Such ‘regulatory hurdles’ could limit rises in freight rates, thereby clouding the share price outlook for Zim’s IPO and other listed container lines, according to Drewry.