ISRAEL's big shipping company, Zim Integrated Shipping Services, is readying itself for sale in hopes of surviving as a Mediterranean regional carrier, reports the Wall Street Journal.

"Zim is on the market," said a source close to the deal. "Their bankers are travelling around the world with a sale prospectus, tapping interest from global shipping majors and other investors."

A second person said Zim's plan was to split the company into an international part that it wanted to sell, while holding on to a handful of ships for Mediterranean trades.

"The part they want sell is their ships and customer base on the routes they have from Asia to the US, from Asia to the east Mediterranean and from the Mediterranean to the US," this person said.

But a Zim spokesman denied the international operations were up for sale.

"Zim is rejecting the rumour that it has intentions to sell its global shipping operations," the spokesman said. "We have been a global player for the past few decades and we have no intentions whatsoever to stop [providing] worldwide services to clients." 

Zim is 32 per cent owned by Kenon Holdings, a holding company based in Singapore and listed in the US and Israel. The rest is owned by banks and shipowners. Marine data provider VesselsValue values Zim's entire fleet at around US$267 million.

Basil Karatzas, a New York-based maritime adviser who works with the industry's biggest operators, said he believed only seven of Zim's 19 containerships would attract buyers' interest, given that they carry up to 10,000 containers each. 

The rest of Zim's fleet are smaller ships, which are fast becoming obsolete after the expansion of the Panama Canal.

Lars Jensen, chief executive of SeaIntelligence consulting in Copenhagen, said Zim couldn't join any alliances as its ships were barred from entering ports of Arab countries that didn't recognise Israel. 

"That leaves them in a precarious situation," he said. "They can ether grow in scale to compete with the big boys - something they can't afford, or become smaller and focus on a niche."