Gulf Bidders Emerge for UASC-linked Shipping Unit

Gulf-based bidders have emerged for the part-owned subsidiary of United Arab Shipping Company (UASC) whose sale is key to finalising the merger between UASC and German container shipping line Hapag Lloyd , sources close to the matter said.

 

Last week, sources told Reuters that Hapag Lloyd was close to completing the 7-8 billion-euro merger after UASC shareholders agreed terms to repay outstanding debt.

 

A sale of United Arab Chemical Carriers (UACC) - in which UASC holds the biggest stake - is also part of the terms of the Hapag Lloyd merger deal.

 

Three finance sources with knowledge of discussions said a few bidders had emerged for UACC, which is estimated to be worth around $200 million.

 

One of the sources said Saudi Arabian shipping company Bahri was among the suitors together with an unidentified United Arab Emirates bidder. All three sources said Qatari shipping group Milaha had also expressed interest.

 

So far, none of the interest has translated into a deal, they added.

 

UACC and Milaha declined to comment, while Bahri and UASC did not immediately respond to a request for comment.

 

UASC has a 45 percent stake in UACC, with the remaining shares held by various Saudi shareholders.

 

UACC's fleet of 24 chemical tankers is estimated to be valued at $478.7 million, down from $576.9 million a year ago due to the fall in ship values for the sector, according to ship valuation company VesselsValue.

 

Sources have told Reuters that if a buyer cannot be found for UACC, UASC's top shareholder Qatar and Hapag Lloyd may have to acquire the shareholding in the unit as part of the merger.

 

Sources say proceeds from the sale of UACC will be used to pay down existing debt that has been financed by a facility provided by Qatar National Bank. QNB did not immediately respond a request for comment.


(By Jonathan Saul and Tom Arnold; Editing by Mark Potter)