Hapag-Lloyd gets shareholders' consent for US$400 capital in

Time: 2017-06-02 13:39
SHAREHOLDERS of German shipping giant Hapag-Lloyd have voted in favour of a US$400 million capital injection via a share issue within six months of the carrier's merger with United Arab Shipping Company (UASC).

"With the approval of the shareholders, all key preconditions have been met for the capital increase, which aims to strengthen the financial position of the company," the Hamburg container line said.

Anchor shareholders have committed to backstop the cash capital increase by buying up any unsubscribed shares in Hapag-Lloyd, which closed on its merger with UASC last week, according to IHS Media.

The shareholders also approved the expansion of the company's supervisory board from 12 to 16 including an advisor to the CEO of the Qatar Investment Authority and the president of the Saudi Ports Authority.

"Hapag-Lloyd has been and continues to be an active driver of the sector's consolidation," Hapag-Lloyd's CEO Rolf Habben Jansen told the shareholders meeting.

"Hapag-Lloyd merged with CP Ships in 2005, and it merged with the container-line business of CSAV in 2014. The merger with the United Arab Shipping Company will now be another milestone for us and a decisive strategic lever for being profitable in the long run.

"For the 2017 business year, the integration of UASC into Hapag-Lloyd will be the focus of our activities."

Hapag-Lloyd said it will start to integrate its 118 services with UASC's 45 services within two months and expects to be operating a single network by the end of the third quarter, after which all of UASC's container traffic will be handled on the German line's information technology platform.

"The merger doesn't only make us bigger, stronger, more flexible, and more international; most importantly, it also makes us more competitive."

The carrier has said it will not be necessary to make sizeable investments in new ships over the next few years. The merger with UASC is expected to generate annual savings of $435 million, with a large chunk achieved in 2018.
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