Maersk said the deal will boost its share of the world container fleet from 15.7 percent to 18.6 percent, and will grow its capacity from 3.14 million TEUs to 3.76 million TEUs if the deal is completed.
The acquisition, which is subject to a final agreement and regulatory approvals, was described as an all cash deal, but the price Maersk is paying was not revealed.
Maersk said it "expects to communicate further details following the approval of the sales and purchase agreement expected early in the second quarter of 2017."
In addition, Maersk said, "The acquisition is subject to a satisfactory due diligence, final agreement and subject to regulatory approval in amongst others China, Korea, Australia, Brazil, the United States and the EU." Maersk said it will work closely with the authorities and expects the regulatory process to last until the end of 2017.
The chart below, constructed with data from BlueWater Reporting's Carrier Trade Route Deployment Report, shows a comparison of Maersk Line and Hamburg Süd's total deployed capacity and estimated weekly allocated capacity on several of the many different trade lanes the carriers participate on.
"The owners and management of Hamburg Süd must, however, recognize that active participation in the consolidation process of the sector currently taking place would entail an even higher capital requirement. This would, in addition, make the balancing of risk within the Oetker Group business portfolio more cumbersome," Oetker Group added. "The owners of the Oetker Group have therefore decided to put Hamburg Süd in the hands of new owners."
In a telephone press conference, Søren Skou, the chief executive of A.P. Moller Maersk and Maersk Line, said his company plans a "light touch integration model" and will maintain Hamburg Süd as a separate brand as it has done with Safmarine in the Africa trades. He said the company believes it can create an "unmatched product" in the Latin America reefer trades and be able to achieve major cost synergies by combining the networks of the two companies and reducing variable costs because of increased buying power.
On the East-West trades, he said Hamburg Süd's volumes would be included in the 2M Alliance.
Skou said the deal was in line with a plan Maersk announced on Sept. 22 to grow market share both organically and through acquisitions. "The acquisition of Hamburg Süd is in line with our growth strategy and will increase the volumes of both Maersk Line and APM Terminals," he said.
Skou said the deal was not dependent on Maersk selling any businesses.
Earlier this week, Reuters reported that A.P. Moller Maersk is in talks to merge its oil and gas operations with those of another Danish company, DONG Energy.
The trade information service Panjiva speculated the deal could face regulatory hurdles.
Panjiva said the addition of Hamburg Süd's business on the East-West trades would only modestly increase the 2M share. On a proforma basis, 2M's share on U.S. import trades would grow from 15.1 percent to 16.8 percent if Hamburg Süd was part of Maersk today, still less than the proforma share of the Ocean Alliance -comprised of CMA CGM (including APL), COSCO, Evergreen and OOCL - slated to commence operations next April. Still, it said the U.S. Federal Maritime Administration is under pressure to take a stricter stance on alliances.
"Another market of concern is Latin America, one of Hamburg Süd's strongest market areas," Panjiva said. "In Brazil it held a 25 percent share in the third quarter of shipments into and out of the country.
"The addition of Maersk’s 10.6 percent to make a total 35.65 percent share may make the combination unacceptable to Brazilian authorities," Panjiva added. "This could be solved, however, by disposals or commitments on market share. There has already been a process of consolidation of market power among larger rivals, the largest of whom would be MSC at 20.2 percent with the top five jointly holding 79.9 percent."
"The timing of this transaction is, we believe, right from the point of view of the cycle, the state of the industry and not least our own position," Skou said. He said that Maersk has become the most competitive carrier, with industry-leading margins driven by lower costs and a strengthened information technology and process platform.
Hamburg Süd provides about half the annual revenues of the family-owned Oetker Group, which is also involved in the food and beverage business.
August Oetker, chairman of the advisory board of Dr. August Oetker KG, the management holding company of the Oetker Group, said, "Giving up our engagement in shipping after an 80 year-long ownership in Hamburg Süd was not an easy decision for my family. We are very confident, though, to have chosen the best of all possible partners. Maersk will preserve and grow Hamburg Süd and what the brand and the whole organization and a highly dedicated workforce stand for: reliable and high quality logistical services to our customers."