Hapag-Lloyd Revises $4.2bn ZIM Deal Amid Israeli Concerns

Hapag-Lloyd and Israeli private equity group FIMI are restructuring their proposed $4.2 billion acquisition of ZIM as they seek to address strong political opposition and win approval from the Israeli government.

The German container shipping group said it has held several rounds of discussions with Israel’s economy, finance and defence ministries. An enhanced proposal is expected to be submitted by the end of September, featuring additional protections for Israel’s maritime security and access to strategically important trade routes.

Under the revised arrangement, the Israeli-controlled business being separated from ZIM would assume greater responsibility for the country’s golden share. It would also operate 16 vessels providing direct connections between Israel and important international markets.

FIMI would own the new ZIM Israel operation. Meanwhile, the level at which an individual foreign shareholder would be required to notify the Israeli government would fall from 24% to 10%. FIMI has also committed to keeping any future listing of the company within Israel.

Hapag-Lloyd chief executive Rolf Habben Jansen said the revised plan would safeguard access to important shipping routes, including services from Asia, while protecting sensitive Israeli cargo movements from foreign interference.

Opposition to the takeover has been growing since the transaction was announced in February. The original agreement valued ZIM at $35 per share and would strengthen Hapag-Lloyd’s position as the world’s fifth-largest container shipping line, with the combined fleet exceeding 3 million teu in capacity.

Workers took strike action shortly after the proposed takeover was announced. A Knesset committee later raised concerns about whether the planned 16-vessel Israeli operation would be capable of meeting ZIM’s logistics obligations during wartime.

Political resistance increased further in July when Prime Minister Benjamin Netanyahu and Defence Minister Israel Katz called for the transaction to be abandoned, arguing that the existing proposal did not provide sufficient protection for national security.

ZIM shareholders have already approved the deal, but the transaction still needs clearance from Israeli authorities and other regulators before it can proceed.