Maersk set to seal €3.7bn German container deal

The transaction is expected to be completed later this year after the European Commission asked the would-be buyer to withdraw Hamburg Süd from five trade routes.

A subsidiary of Danish conglomerate Møller-Mærsk has approved the €3.7 billion acquisition of German container shipping line Hamburg Süd .

Maersk Line will complete the deal with the Oetker Group later this year, subject to regulatory approvals, as it seeks to capitalise on a “unique opportunity”. The company said the deal will generate operational synergies between the two businesses of between $350 million and $400 million in the next two years alone through an increased number of sailings and an expanded global reach.

Maersk said the transaction, to be completed on a cash and debt-free basis, will be financed through a syndicated loan facility. It declined to comment further on the structure and the identity of the debtors.

The move was approved by both the boards of Maersk and Oetker after the European Commission agreed to the deal last month, on the condition of the withdrawal of Hamburg Sud from five consortia on trade routes connecting Europe to the Caribbean, South America and the Middle East and linking the Mediterranean to South America. The deal “would have resulted in anti-competitive effects” without such measures, the EC said.

“We consider the purchase price of €3.7 billion a fair valuation of Hamburg Süd,” said Maersk Line and Moller–Maersk chief executive Soren Skou. “By keeping Hamburg Süd as a separate and well-run company, we will limit the transaction and integration risks and costs while still extracting the operational synergies. The acquisition of Hamburg Süd will therefore create substantial value to Maersk Line already in 2019.”

Skou replaced former Moller-Maersk boss Nils Andersen in June last year and immediately initiated a strategic review. The company announced a few months later it would be separating its oil-related business from the company, leaving it to focus on the growth of its transport and logistics revenue streams.