Neptune Orient Lines Ltd (NOL) today moved to further strengthen its balance sheet through a share placement of 236 million shares on the back of strong third quarter results.

NOL suspended trading in its shares at nine this morning.

Releasing third quarter results that showed a net profit of US$206 million for the third quarter and US$294.6 million for the year to date, Chairman Cheng Wai Keung said, ”In view of our improved performance and with the industry poised for further growth, we believed that it would be timely to raise capital to reduce our debt levels and prepare for future growth.”

Group CEO of the global container transportation and logistics company, David Lim, said, “The placement will strengthen our balance sheet even further, reducing our debt equity ratio, and giving us the flexibility to be able to move quickly to make the most of opportunities that may arise in the future.

“Our industry is growing and we intend to grow with it,” Mr Lim said.

Mr Lim said reducing the company’s debt levels also reduced NOL’s vulnerability to the fluctuations historically common in the shipping industry, allowing the company to ride any future troughs more easily.

Group Chief Financial Officer Mr Lim How Teck said the Group expects the share placement will be completed overnight and aims to raise around US$300 million, which would reduce NOL’s net gearing to about one. Mr Lim expects that, going forward, this will further improve through operational gains and divestment of non-core assets.

Institutional investors in Asia, Europe and the United States are being targeted.

The placement is being facilitated through a scrip lending arrangement with NOL’s majority shareholder, Temasek Holdings.

Trading in NOL shares is expected to resume at 9:00am Tuesday, 11 November.

Credit Suisse First Boston has been appointed as the sole bookrunner for the placement.