Hapag-Lloyd Delays IPO
By Aiswarya Lakshmi
Thursday, October 29, 2015
German container shipping group Hapag-Lloyd AG is postponing its stock market debut by a week after investors shied away from the company following Maersk Line’s modest profit forecast last week, reports Reuters.
If demand for the shares remains weak Hapag may lower the offer price, the people familiar with the deal said on Tuesday, adding that cancelling the IPO also remained an option.
The company said it would publish a supplement to the IPO prospectus issued on Oct. 14 in due course.
Hapag-Lloyd said it was extending the offer period for its initial public offering (IPO) by a week to Nov. 3, with trading now likely to start on Nov. 6.
"The order book had been more than one time subscribed. Now the main goal is to get investors to come back who have shied away due to Maersk," one of the people said.
The extension of the offer period is linked to weak demand for the shares even after the carrier cut the planned scale of the IPO to $300 million from the $500 million originally targeted because of stock market volatility caused by the Volkswagen emissions scandal and China’s economic slowdown.
Average shipping rates for containers fell 36 percent in the third quarter, according to the World Container Index.
“Across all major routes, volumes and rates remain weak, with Asia-Europe rates affected the most due to overcapacity,” Klaskow and Bloomberg Intelligence analyst John Mathai wrote in a report