Hapag-Lloyd Confident in Merger Closure Soon Despite Reports of a “Snag”
- Business & Finance
German liner company Hapag-Lloyd believes its merger with the United Arab Shipping Company (UASC) would be closed within the next few weeks despite reports that the deal has been hindered by Qatar.
The two liners reportedly fear that Qatar, which is UASC’s top shareholder, might sell some of its shares that could in turn be bought by some of the rival boxship companies, Reuters reported.
Furthermore, Hapag Lloyd and banks are said to have sought assurances from Qatar Investment Authority (QIA) that there would be no change in the share ownership by QIA.
In a response to World Maritime News, Hapag-Lloyd’s spokesperson declined to comment on the said reports, saying that the company is “pretty confident to close the transaction within the next few weeks.”
Earlier this month, the duo said in a joint release that they would shift the Long-Stop Date under their merger until May 31, 2017 from the originally envisaged March 31, 2017.
The delay was ascribed to “the final preparations” that take “more time than expected”.
The German container shipping firm added that it had obtained all merger clearances and authority approvals as well as all necessary banking approvals, and that on UASC’s side “substantially all banking approvals…have been obtained,” stressing that the transaction itself was not at risk.
Speaking to World Maritime News at the time, Hapag-Lloyd said that the delay was merely “a technical thing” as neither Hapag-Lloyd nor UASC are interested in withdrawing from the deal.
Irrespective of the actual closing date of the merger THE Alliance will start its operation as of April 1, 2017 including all vessels as planned, Hapag-Lloyd assured.
However, UASC will not become an individual member of the alliance, but would contribute ships and get slots via Hapag-Lloyd only.
From 2019 onwards, Hapag-Lloyd expects the merger to result in annual synergies of USD 435 million. This is offset by one-off expenses of around USD 150 million resulting from the transaction and the integration of UASC into Hapag-Lloyd.
Hapag-Lloyd closed the 2016 financial year with a net result of EUR -93.1 million against a profit from 2015 of EUR 113.9 million.
World Maritime News Staff