Dive Brief:
- Maersk Line has offered concessions to the European Commission in hopes of securing approval for its acquisition of Hamburg Sud's assets, Reuters reported Wednesday.
- The initial ruling on the merger was set for March 27 but has now been moved to April 10 in light of the new concessions.
- Antitrust concerns regarding the two lines' combined assets in South America are at the heart of the regulators' hesitation to approve the deal, according to JOC.com.
Dive Insight:
The specific concessions offered by Maersk Line are not specified, but almost certainly address the line's post-consolidation market share, particularly in South America.
If Maersk Line succeeds in acquiring Hamburg Sud's full assets, the company would operate two major lines operating in the U.S. East Coast - South America trade lane and control up to 80% of the market, according to JOC.com. If the European Commission does not approve it, a five month investigation would follow, per the report.
In general, a full acquisition would provide Maersk Line with 18.6% of global container capacity, which is more than double the size of 6 of the top 10 global lines.
The European Commission provides further information as to the lines' specific assets: Maersk operates 611 vessels (324 chartered) and has offices in 112 countries; Hamburg Sud operates 130 vessels (82 chartered) with five headquarters worldwide. The two lines officially signed a sale agreement March 14, wherein Hamburg Sud agreed to sell its affiliates and main business assets to Maersk.
A divestment could come in the form of agreeing to sell an affiliate, sell vessels, containers or slot capacity, among other possibilities. A final decision will come April 10, however, at which point full information will be available.
