Chinese shipping behemoth Cosco has made a $6.3bn (£4.9bn) bid to buy Hong Kong rival Orient Overseas (OOIL).
The approach, announced overnight, is the latest deal in a wave of consolidation in the shipping sector. The six largest firms already control two-thirds of the market.
Cosco would become the world’s third largest shipping line – behind Demark’s Maersk and Swiss firm Mediterranean Shipping – with more than 400 vessels.
Given its size, the deal will need to be signed-off by regulators.
The offer represents a 31 per cent premium to OOIL’s share price. The Hong Kong firm’s shares jumped more than 20 per cent following the announcement of the approach, while Cosco’s shares hit a two-year high.
Jefferies analyst Andrew Lee said the approach looked like “an expensive acquisition”.
Earlier this year, the Cosco Development – the world's largest cargo ship – caused a stir on the east coast of the US by barely clearing a suspension bridge as it sailed to Savannah Port, Georgia.