In order to get through the crisis of global shipping, Germany-based container line Hapag-Lloyd will ally with United Arab Shipping Company (UASC).
HL is in talks to merge with UASC, representing the latest move in container shipping corporate consolidation, Reuters reports.
Hapag-Lloyd gave no details on the talks, saying there was no certainty of a deal, though a successful merger would create a group with an estimated enterprise value in the region of EUR8 billion (US$9 billion).
Kuwait-based UASC, owned by Gulf Arab states with Qatar holding the majority stake, was not available for comment.
However, the shareholders in UASC will vote soon to approve a “business combination” agreement with Germany-based container line Hapag-Lloyd.
The nature of such a combination has not yet been disclosed, but it could potentially include a merger, says sources.
"The talks between HL and UASC regarding a potential combination of their respective container shipping operations are ongoing; no binding agreement has yet been reached. The potential transaction is subject to the approval of the regulatory authorities, the relevant bodies at HL and other stakeholders," says a statement from UASC .