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Germany’s Hapag-Lloyd and United Arab Shipping Company (UASC) are all set to merge, after a series of announcements from both shipping lines. A statement from the Hamburg-based carrier said: “Hapag-Lloyd and UASC have reached an agreement on the terms and conditions of a business combination agreement (BCA) providing for the contribution of all shares in UASC to Hapag-Lloyd.”
While Hapag-Lloyd’s supervisory board has approved the agreement, the final conclusion of the merger is dependent on receiving shareholder approval from both companies. An extraordinary general meeting of UASC shareholders was held on June 29th in Dubai, and all six of UASC’s shareholding states voted unanimously to approve the proposed merger with a relative valuation of the two businesses at 72% for Hapag-Lloyd’s shareholders and 28% for UASC’s shareholders. A similar meeting of Hapag-Lloyd shareholders is now being arranged, and is also expected to vote in favour.
Subsequently, both companies will initiate the requests for the necessary regulatory approvals. Until then, both companies will continue to operate as independent, stand-alone companies. Once the regulatory approvals are received, the integration of some activities are expected to begin. However, both companies will still continue to operate in their current alliances until the end of March 2017.
If it gets the green light from regulators it will create the world’s fifth biggest container operator.
