Hapag-Lloyd AG is in the final stages of negotiations to buy its Israeli rival Zim Integrated Shipping Services Ltd, as announced by the German company on Sunday.
They are also in advanced discussions with Israeli financial investor FIMI Opportunity Funds regarding assumptions related to special rights tied to obligations from the state of Israel. However, no binding agreements have been signed yet, according to a statement made to the stock exchange.
Based on information from a source close to the discussions who wished to remain anonymous, the deal is expected to be finalized this week after months of negotiations that Zim conducted with potential buyers.
Once all regulatory and government approvals are granted, Zim will be removed from the New York Stock Exchange, where it is currently valued at $2.7 billion. Earlier reports from the Israeli business daily Calcalist indicate that the sale price may go above $3.5 billion.
In response to the news, Zim's workers' union in Israel has decided to stop activities at the company's headquarters in Haifa. The company stated that management is in talks with the union to prevent any negative effects on ongoing operations, acknowledging the employees' concerns and emphasizing that their best interests are a priority.
Hapag-Lloyd ranks as the fifth-largest cargo shipping company in the world, holding a 7.4% market share. Zim is ninth with a 2.4% market share.
Based in Haifa, Zim operates a fleet of 145 ships, which includes 130 container vessels and 15 vehicle transportation vessels. The company follows a “charter-intensive fleet model,” meaning that many of their ships are leased instead of owned.