The volatility stems from a Ynet report detailing a recent cabinet meeting where Prime Minister Benjamin Netanyahu and Defense Minister Israel Katz signaled deep skepticism regarding the deal. While the proposed merger includes a structural workaround—maintaining a separate Israeli entity to satisfy local ownership regulations—the government’s stated concerns suggest these measures may not be sufficient to secure regulatory approval.

In response to the market reaction, the shipping firm maintained a defensive posture. The company stated that it remains committed to the existing merger agreement and is currently navigating the necessary regulatory review process with state authorities. Whether the Israeli leadership will formalize its opposition into a legal injunction remains the central question for stakeholders watching the $4.2 billion deal.