Hapag-Lloyd and UASC Pen Business Combination Agreement
Container carriers Hapag-Lloyd AG and United Arab Shipping Company S.A.G. (UASC) have signed a Business Combination Agreement (BCA) to merge both companies, subject to the necessary regulatory and contractual approvals.
Following regulatory and contractual approvals expected to be obtained by the end of 2016, the new Hapag-Lloyd will own and operate 237 vessels with a total transport capacity of around 1.6 million TEU. The new company is expected to handle an annual transport volume of 10 million TEU and have a combined turnover of approximately USD 12 billion.
The combined company will remain a registered and stock listed company in Germany with its head office in Hamburg.
CSAV, HGV (City of Hamburg) and Kühne Maritime will remain controlling shareholders of Hapag-Lloyd. The majority shareholders of UASC, Qatar Holding LLC and The Public Investment Fund of the Kingdom of Saudi Arabia, will become new key shareholders of Hapag-Lloyd holding 14 per cent and 10 per cent, respectively.
“This strategic merger makes a lot of sense for both carriers – as we are able to combine UASC’s emerging global presence and young and highly efficient fleet with Hapag-Lloyd’s broad, diversified market coverage and strong customer base. Furthermore it will give the new Hapag-Lloyd access to Ultra Large Container Vessels,” said Rolf Habben Jansen, CEO of Hapag-Lloyd.
“After the successful integration of CSAV which was concluded mid of 2015 this transaction with UASC is another historic milestone for Hapag-Lloyd. The merger reinforces our position as a top 5 and one of the largest truly global carriers in liner shipping.”
The fleet of the combined company will include UASC´s six recently received 18,800 TEU ships, including Barzan, the container shipping industry’s first LNG-ready ultra-large container vessel, as well as eleven newly built 15,000 TEU ships, the last of which will be delivered soon.
“With this merger, we are embarking on an exciting new phase of UASC´s growth,” said Jorn Hinge, President and CEO of UASC.
“Leveraging on UASC´s heritage in the Middle East as well as our recent growth in other markets, the combined company will provide customers with valuable expertise and very efficient service offerings in all major trade lanes and markets around the world.
The company will be the part of the new “THE Alliance” – consisting of Hanjin, Hapag-Lloyd, K-Line, Mitsui O.S.K Lines, Nippon Yusen Kaisha and Yang Ming. THE Alliance is scheduled to begin operation in April 2017 and will cover all East-West trade lanes including Asia-Middle East/Arabian Gulf and Red Sea.
UASC and Hapag-Lloyd will continue to operate as stand-alone companies until the merger is approved. Each company will also operate in its own alliance as currently structured until the end of March 2017, after which THE Alliance will commence operations.