Investing.com -- Zim Integrated Shipping Services stock is showing a 3.4% increase prior to the market opening, following a report by Street Insider that the company’s management is discussing a potential take-private transaction with advisers.

Jefferies analyst Omar Nokta thinks that investors might oppose such a deal at the current stock price. He points out that the shipping company’s cash reserves exceed its market capitalization, it carries little debt, and has a history of disbursing substantial dividends.

Adding to the complexity of such a deal, Nokta mentions the change-of-control rules in Israel, which could make the transaction more challenging.

When asked by the bank about the Street Insider report, Zim declined to comment, stating that it does not respond to market rumors.

Nokta currently rates Zim’s shares as a hold, with a price target of $18.

Zim is set to report its fourth-quarter results on March 12. The company’s stock has seen a 7.9% decrease year-to-date through the close of trading on Thursday.

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