Hapag-Lloyd Is Said to Discuss All-Stock Takeover of CSAV

Hapag-Lloyd AG, Germany’s biggest container shipper, is negotiating an all-share transaction to acquire Chile’s Cia. Sud Americana de Vapores SA, according to three people with knowledge of the talks.

The proposed deal would bring in the billionaire Luksic family, which controls CSAV with a 46 percent stake, as a Hapag-Lloyd shareholder, joining billionaire Klaus-Michael Kuehne, who owns 28.3 percent of the Hamburg-based shipper, said the people, asking not to be identified as talks are private. CSAV shares surged 13 percent yesterday.

CSAV shareholders would own about 30 percent of the combined company, one of the people said.

Officials at the Chilean company declined to comment on the talks through an external press representative, who asked not to be named citing company policy. Andronico Luksic, chairman of family holding company Quinenco SA, didn’t respond to a request for comment made through an assistant in Santiago. In a statement published today on the Santiago stock exchange’s website, CSAV said that discussions with Hapag-Lloyd haven’t resulted in any agreement, binding or otherwise.

Executives from both companies are in talks in Germany this week as they seek to overcome a prolonged slump in the container shipping market and compete with larger rival A.P. Moeller-Maersk A/S, one of the people said. The Luksics, Chile’s wealthiest family, took a bet on the industry in 2011 when it began building a stake in Valparaiso, Chile-based CSAV.

Public Listing

Hapag-Lloyd is turning to Latin America’s biggest container shipper after talks to merge with local competitor Hamburg Sued failed in March because shareholders of both companies couldn’t agree on terms.

Tour operator TUI AG, which has repeatedly said it wants to divest its 22 percent stake in Europe’s fourth-biggest container liner, is considering the public listing of a small amount of shares in Hapag-Lloyd as a first step to exit, Chief Financial Officer Horst Baier said in a Dec. 18 interview.

Hapag-Lloyd shareholders have delayed an IPO as they await improved market conditions, TUI Chief Executive Officer Friedrich Joussen said Sept. 27.

Francisco Perez holds the seat of CSAV chairman after Andronico Luksic’s older brother Guillermo died last year. It was Guillermo who led the family’s $1 billion-plus investment to take control of 150-year-old CSAV, known locally as Vapores.

Share Rally

CSAV lost a record $1.25 billion in 2011 as the industry suffered from an oversupply of vessels that were commissioned to be built prior to the economic crash of 2008.

The Luksics cut unprofitable routes, focusing on Latin America, and adding to its own fleet while shedding rented ships. CSAV said it was in talks to form an alliance with Hapag-Lloyd last month. The two companies share some shipping routes from Latin America.

Shares in CSAV jumped 13 percent yesterday extending a year-to-date rally to 21 percent. The stock fell 1.1 percent to 33 pesos at 9:47 a.m. in Santiago today.

Two of the people with knowledge said Hapag-Lloyd seeks to seal a final agreement with CSAV in the first half before CEO Michael Behrendt retires. His successor is Rolf Habben-Jansen, the former head of Maersk’s freight-forwarding arm Damco NV, who will join the board of Hapag-Lloyd in April before becoming CEO in July.

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