Global shipping company Hapag-Lloyd has announced a new agreement to fully acquire the world’s 10th largest container shipping line.
In a transaction amount of more than $4 billion USD (roughly $5.6 billion AUD), Hapag-Lloyd will acquire 100 per cent of shares in ZIM Integrated Shipping Services.
With the acquisition seeing Hapag-Lloyd acquire ZIM shares for $35 USD ($50 AUD) per share in cash, the combined business will exceed a standing capacity of more than three million TEU.
The deal will see a combined business consisting of more than 400 vessels transporting over 18 million TEU each year.
Israel’s largest and leading private equity fund FIMI will take ownership of a carved-out container line business that will serve some of the most important strategic trade-lanes, connecting to the Hapag-Lloyd global network.
The new FIMI container line will start with 16 modern, sizeable and efficient vessels and will soon take over full responsibility for ZIM’s Special State Share (Golden Share) held by the State of Israel, as well as the ZIM brand.
The combination of businesses would see Hapag-Lloyd become the fifth largest container shipping company worldwide and generate several hundred million dollars of additional revenue.
“ZIM is an excellent partner for Hapag-Lloyd,” Hapag-Lloyd CEO Rolf Habben Jansen says.
“Customers will benefit from a significantly strengthened network on the Transpacific, Intra Asia, Atlantic, Latin America and East Mediterranean. We share the same ambitions: great customer service, outstanding operational quality and a commitment to digital innovation – all powered by the expertise and passion of our people worldwide.
“We will use this opportunity to create the best team from the exceptional talent in ZIM and Hapag-Lloyd – in Israel and around the globe – and we commit ourselves to build a very substantial and long-term presence in Israel. Together, we will set new benchmarks of excellence and secure our position as the undisputed number one for quality in our industry.”
ZIM board chair Yair Seroussi says the announcement is the culmination of a “thorough strategic review” conducted by the board to maximise shareholder value.
“The decision reflects a comprehensive evaluation of all available options to ensure the best possible outcome for the company’s investors,” Seroussi says.
“We believe that it represents the most prudent and beneficial transaction for all ZIM stakeholders that further advances the tremendous value creation track record that we have established since our IPO.”
Until the transaction is finalised, Hapag-Lloyd and ZIM will remain competitors in the container shipping market. The deal is subject to regulatory approval, which is expected by later this year.