European Commission okays MSC 49.9 percent stake in HHLA

Admin I Friday, October 04, 2024

 

BRUSSELS – The European Commission, EC has approved the controversial acquisition of a stake in the Hamburg-based port logistics company HHLA by the world’s largest shipping company, MSC, on Friday.

“The Commission concluded that the proposed concentration would not raise competition concerns, given its limited impact on competition in the markets in which the companies are active,” it said in a statement.

The decision means the deal should now go ahead, after the transaction was examined in the normal merger control procedure.

Hamburg’s parliament gave its final approval to the MSC takeover at the beginning of September. Hamburg’s state government plans to bring the Mediterranean Shipping Company (MSC) on board to stabilize Hamburger Hafen und Logistik (HHLA) and container handling.

The city is to hold 50.1% of the company and MSC 49.9%. So far, the city has owned around 70%, with the rest in free float.

In return, MSC wants to increase its cargo volume at the HHLA terminals from next year onwards and almost double it to 1 million standard containers per year by 2031.

The Swiss shipping company also wants to build a new German headquarters in Hamburg.

If the Ukrainian authorities also agree, as HHLA operates a container terminal in Odessa, all conditions for execution will have been met, and the deal will then be closed.

German trade union Verdi and dock workers oppose the deal because they fear jobs will be cut.

In addition, the deal would give MSC extensive de facto veto rights, leading some experts to warn against the deal in hearings, describing it as a “historic mistake.”