Qatar’s intransigence over its commitment to containerline United Arab Shipping Company (UASC) is believed to be holding up the complex merger with Germany’s Hapag-Lloyd, according to Reuters.
Hapag-Lloyd and banks have demanded UASC’s largest shareholder, the sovereign wealth fund Qatar Investment Authority, to not plan sell any shares in UASC going forward, for fear that a rival liner could then buy into the merged entity.
Qatar holds a 51% stake in UASC, Saudi Arabia has 35% with the rest controlled by the United Arab Emirates, Bahrain, Kuwait and Iraq. Post-merger, Qatar’s holding will be 14%.
Hapag-Lloyd and UASC recently pushed back their merger deadline by a couple of months to the end of May with the Dutch national at the helm of the German line, Rolf Habben Jensen, saying earlier this week he had underestimated the complexity of the $8bn merger deal.
Qatari officials declined to comment to Reuters as did spokespeople from UASC and Hapag-Lloyd.
Another reason cited by Reuters for the delay in competing the deal is the trickiness in selling UASC subsidiary United Arab Chemical Carriers (UACC), which is necessary under the terms of the merger.
A spokesperson for Hapag-Lloyd declined to comment on the specific issues holding up the merger when contacted by Splash. However, he did say: “We are pretty confident to close the transaction within the next few weeks.”