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Hapag-Lloyd UASC Merger to Get EU Approval Soon

Maritime Activity Reports, Inc.

November 16, 2016

 The planned merger between German container shipping line Hapag-Lloyd and United Arab Shipping Company (UASC) could be on the verge of gaining EU Antitrust approval, reported Reuters.

 
The planned tie-up, which would create the world’s fifth-largest carrier is one step closer to becoming a reality after sources close to the deal told Reuters that UASC had agreed to pull out of some vessel sharing agreements, seen as a key stumbling block in gaining approval.
 
The combined company, valued at about 7 to 8 billion euros ($7.5-$8.6 billion), would be the world's fifth largest shipping company, with access to the Asia to Europe trade route and trans-Atlantic and trans-Pacific routes.
 
The shipping companies offered the concessions last month in a bid to fend of the European Commission's concerns but did not provide details. Kuwait-based UASC is owned by Gulf Arab states with Qatar holding a majority stake.
 
Commission spokesman Ricardo Cardoso declined to comment.
 
"We don't know anything about this, this is completely new information to us," Hapag-Lloyd spokesman Nils Haupt said after consulting with the company's lawyers. UASC was not immediately reachable outside office hours.
 
The container shipping industry has seen a series of mergers in recent years as companies combine their forces to deal with the worst slump in five decades caused by over-capacity and weak global economic growth.
 
Companies are also seeking alliances to pool trips and save costs. Hapag-Lloyd in May announced a new alliance with five Asian competitors.