News / MSC extends deadline on HHLA share offer in move for more control

Photo: HHLA

MSC has extended the deadline for its share purchase offer to HHLA shareholders to 7 December, as it closes in on the deal to jointly own the Hamburg port logistics company.

The world’s largest shipping line wants to run HHLA as a joint-venture with the City of Hamburg, the municipal authority owning a strategic 50.1% majority, and MSC the remaining 49.9%.

Hamburg’s municipality currently owns around 69% of HHLA, with 31% floated on the Frankfurt Stock Exchange. Of that 31%, MSC has already purchased around a third through market trading, and the two offered private and institutional investors €16.57 per share to acquire the remainder, with an initial deadline of 20 November.

By the end of 20 November, MSC was tendered a further 3.9%, taking the Hamburg-MSC total to “around 84.21% of the company’s share capital and voting rights”, according to a company update.

The new total represents a significant jump from the 75% figure toted by MSC Germany CEO Nils Kahn in early November. Crucially, by passing the 80% line, the City and MSC have reduced the quota of remaining HHLA shareholders to below a “blocking minority”, which means they will be powerless to prevent the passing of important decisions.

The next key threshold is 90% control – at that point, the two partners will be empowered to “squeeze out” the remaining shareholders via compulsory share purchases. So, should MSC get its hands on a further 6% of shares to reach that joint total with the City, its maximum 49.9% stake is well within reach.

As a result, MSC has triggered a two week “further acceptance period”, beginning yesterday and ending on 7 December at 12am CET.

It would appear that the finish line is in view for the world’s largest shipping line and its aspirations to both acquire a terminal operator that accounts for some 75% of Hamburg’s box throughput, as well as a ready-made intermodal network covering central and eastern Europe. that would represent a step-change for MSC’s overland subsidiary Medlog*.

(*For more on that, read our Premium’s coverage: ‘HHLA, Hapag, MSC – ‘mutually assured destruction’?‘ on 20 September, which followed ‘MSC vs Kuehne – a bidding war in Hamburg?‘ and preceded ‘German M&A redux: from Schenker to HHLA – ‘price or politics’?‘)

It would also appear to mark the end of the ambitions of Hamburg native, and majority owner of the world’s largest freight forwarder Kuehne + Nagel, Klaus Michael Kuehne, in his quest to acquire a stake in HHLA. He is also the largest shareholder in German shipping line Hapag-Lloyd, which many analysts thought would be the ideal bedfellow for HHLA.

Earlier this month, he reiterated his interest in taking over the terminal operator, in an interview with Frankfurter Allgemeine Zeitung, saying: “I want to shake up Hamburg,” and arguing the city “is on the path to gradual decline and it must be stopped”.

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