Hapag-Lloyd urges Israel to review improved offer for shipping services company ZIM

By Reuters News

BERLIN, Sept 29 (Reuters) - Hapag-Lloyd HLAG.DE on Tuesday urged Israeli authorities to review improved terms in the company's $4.2 billion bid for ZIM Integrated Shipping Services.

Israel's finance ministry had said on Monday that the deal should not be approved, but the German shipping group said the ministry's position did not reflect substantial improvements presented last week.

The improvements include a direct shipping route to Asia and stronger state protections under an updated golden share arrangement.

In a related deal, Israeli private equity fund FIMI plans to acquire 16 vessels carved out from ZIM under a new company called ZIM Israel, securing direct global maritime connections for Israel.

The initial proposal faced heavy opposition in Israel, with the finance ministry saying on Monday that "the economic, operational and security risks significantly outweigh the benefits".

The ministry also raised concerns over Hapag-Lloyd's shareholder structure, noting that Qatar held a 12.3% stake and Saudi Arabia 10.2% in the German company. The ministry said that this "creates a tangible strategic risk regarding political pressure and foreign influence during times of crisis."

Hapag-Lloyd and FIMI submitted key points of a revised proposal on September 24, Hapag said on Tuesday. Those included a direct Far East shipping route, in-house maritime operations for ZIM Israel, investment in Israeli seafarers and additional safeguards for Israel's transportation needs.

The new proposal also offered stronger state protection of Israel's "golden share", which gives it special ownership rights in ZIM. The strengthened provisions would increase Israel's authority and control over ownership changes, prevent any foreign interference and ensure Israel's independence and control over ZIM Israel's fleet.

Hapag-Lloyd said full details of the revised framework would be finalised within 45 days and that it remained focused on closing the transaction by the end of the year.

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