HHLA: Boards greenlight takeover offer by MSC

The Executive Board and the Supervisory Board of Hamburger Hafen und Logistik AG (HHLA) today published their joint Reasoned Statement pursuant to Section 27 of the German Securities Acquisition and Takeover Act (WpÜG) on the takeover offer by the Mediterranean Shipping Company S.A. (MSC) on 23 October 2023. Both boards recommend to the shareholders to accept the offer. In negotiations with the City of Hamburg and MSC, the Executive Board and the Supervisory Board reached extended commitments for the long-term development of HHLA.

According to the agreement, the City of Hamburg will remain the majority owner of HHLA and will co-manage the company with MSC in order to promote the further development of HHLA. To this end, the City of Hamburg intends to hold a 50.1% stake and MSC will hold no more than 49.9%. It is worth noting that a subsidiary of MSC revealed in September 2023 that it plans to acquire a 49% stake in HHLA. The acquisition documents were officially filed on October 23rd.

During the negotiations with the City of Hamburg and Mediterranean Shipping, the Executive Board and the Supervisory Board of HHLA agreed on a long-term commitment for the long-term development of the company. Individual points of the business combination agreement that have not yet been finalized in a preliminary binding framework agreement will be addressed in further discussions in the coming weeks.

“As the Executive Board, we have actively addressed the aspects of the transaction relevant to HHLA and our stakeholders in intensive discussions with the City of Hamburg and MSC in recent weeks and have largely secured them in the binding preliminary framework agreement,” Angela Titzrath, Chief Executive Officer of HHLA, said.

“The preliminary framework agreement that has been signed addresses the key interests of all HHLA stakeholders. With the agreements reached, we are securing the future viability of HHLA and its business model. As the offer price is deemed adequate following our review, the HHLA Supervisory Board and the Executive Board recommend accepting the offer from MSC,” Rüdiger Grube, Chairman of HHLA’s Supervisory Board, commented.

The commitments in the binding preliminary framework agreement cover the following areas in particular:

  • Subject to the approval of the Hamburg Parliament, the City of Hamburg and MSC will provide HHLA with additional equity capital totaling €450 million for investments in business operations over the next few years following the closing of the transaction.
  • The neutrality and independence of HHLA’s business model, in particular of the intermodal subsidiary Metrans, and thus the equal treatment of all customers will be ensured. All customers continue to have equal access to all HHLA terminals and services throughout Europe.
  • HHLA retains decision-making authority over its investment planning. In particular, the ongoing modernization of HHLA’s container terminals in Hamburg and the international expansion of the intermodal network in the coming years are thus secured. The City of Hamburg and MSC will support the corresponding investment plans totaling at least €775 million in the years 2025 to 2028.
  • Significant commitments were achieved for the employees, in particular the exclusion of redundancies for operational reasons for at least five years. Co-determination within the HHLA Group continues to be maintained.
  • Ultimately, an understanding was reached on the continuation of HHLA’s existing strategy. HHLA will thus remain a European logistics company. The planned sustainable reorganization of the container segment and the expansion of the European intermodal network, in particular with regard to Metrans, will be driven forward with a focus on Hamburg.

The boards have okayed the takeover offer despite recent protests of hundreds of HHLA employees. In September, the workers strongly voiced their concerns about the partial sale of HHLA to MSC.

Yangzijiang Shipbuilding

Most Popular