Zim Integrated Shipping Services (ZIM) stock jumped about 7% in Tuesday’s pre-market trading after the company confirmed that it has received multiple competitive acquisition proposals from many strategic parties. The company said that it received these proposals as part of its ongoing review of strategic alternatives.
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Zim Integrated Sees Acquisition Interest from Multiple Parties
Israel-based Zim Integrated has advanced about 18% over the past month amid news of a management buyout and reports of takeover interest from shipping players Hapag-Lloyd (HPGLY), MSC, and Maersk (AMKBY). In late November, the company announced that it launched a strategic review of alternatives after receiving a preliminary, non-binding proposal to acquire all its shares from President and CEO Eli Glickman and Rami Ungar.
On Monday, Zim stated that it received a revised proposal from an entity owned by Glickman and Ungar. Its board of directors concluded that this revised proposal “significantly undervalued” the company and accordingly informed the management-led entity that it had rejected it.
The company added that the strategic review, which is in advanced stages, includes consideration of potential value-creation alternatives, including a possible sale, as well as capital allocation and potential return opportunities, with the aim of maximizing shareholder value.
ZIM has been under pressure amid geopolitical tensions, tariff wars, and global trade wars. The company reported an 89% year-over-year decline in its Q3 earnings per share (EPS) to $1.02, as revenue plunged 36% to $1.78 billion. The average freight rate per TEU fell 35%.
Is ZIM a Good Stock to Buy?
Currently, Wall Street has a Moderate Sell consensus rating on Zim Integrated Shipping Services stock based on two Holds and three Sells. The average ZIM stock price target of $13.92 indicates 30% downside risk.
