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Published: 17 December 2013
Hapag-Lloyd stirs the pot
Hapag-Lloyd's chairman Michael Behrendt says that the line will catch up with the P3 partners and possibly become the Number 1 container carrier
Michael Behrendt, Chairman of both the Management Board of Hapag-Lloyd and of VDR (the German shipowners' association), is one of the most senior shipping executives in Germany. He may retire next summer and possibly take over as Chairman of the Hapag-Lloyd Advisory Board, but he has stirred up international shipping circles by announcing that Hapag-Lloyd will grow to catch up with the P3 partners and possibly become the global No. 1 in the worldwide container shipping business.
“Our target must be to create something bigger by merging several organisations to become one big entity,” he said, gaining market share and reducing the gap with Maersk, MSC and CMA CGM. A first step in this direction could be the merger or takeover of Chilean carrier CSAV’s loss-making container business.
Negotiations have been going on for some time and were officially confirmed by Hapag-Lloyd after the talks were leaked in the German press (http://www.worldcargonews.com/htm/w20131205.461974.htm), but it was also rumoured that CSAV is in talks with other carriers over a possible merger or some form of strategic cooperation. The talk in Hamburg is that Hamburg Süd would be the most obvious partner as its trades in the same region as CSAV.
Referring to the various attempts to merge Hapag-Lloyd and Hamburg Süd, Behrendt stated: “It does not get us anywhere to complain that they did not work. Sometimes it is over and one has to move on.” However, Behrendt and his senior colleagues remain convinced that a merger with Hamburg Süd is the best solution for both parties. As to the question of an IPO, he said that TUI "does not need to worry. If the frame conditions are right we are ready for it.”
Behrendt described the behaviour of the liner shipping industry as, at best, "irrational." After five years of losses, shipping companies are still not prepared to merge. There is still loose money sloshing around, so owners are waiting for better times. "I know of no other industry in which making a profit has become a swear word. What is happening is grotesque. The way some companies are operating in our industry makes me think they are treating it as a hobby."