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Hapag-Lloyd’s merger with UASC reportedly being held up by Qatari sovereign wealth fund

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.”

Sam Chambers

Starting out with the Informa Group in 2000 in Hong Kong, Sam Chambers became editor of Maritime Asia magazine as well as East Asia Editor for the world’s oldest newspaper, Lloyd’s List. In 2005 he pursued a freelance career and wrote for a variety of titles including taking on the role of Asia Editor at Seatrade magazine and China correspondent for Supply Chain Asia. His work has also appeared in The Economist, The New York Times, The Sunday Times and The International Herald Tribune.
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