Hapag-Lloyd has signed an agreement to acquire 100% of ZIM Integrated Shipping Services for approximately $4.2bn in cash, the German container shipping company announced on 16 February.

The acquisition will be carried out through a merger of an Israeli subsidiary of Hapag-Lloyd with ZIM, with the Israeli company continuing as a wholly owned subsidiary. ZIM shareholders will receive $35.00 per share in cash.

Hapag-Lloyd will finance the transaction from its cash reserves and external financing of up to $2.5bn.

The deal is subject to several conditions, including approval from the State of Israel as holder of special rights in ZIM’s articles of association, and the release of ZIM from obligations arising from these special state rights.

Under a separate agreement, Hapag-Lloyd has arranged for a company controlled by FIMI Opportunity Funds, an Israeli financial investor, to assume the obligations arising from the special state rights. This structure involves transferring 12 ships and assets required for operating three trade routes from Hapag-Lloyd or ZIM to the FIMI-controlled entity.

Completion of the acquisition also requires approval from ZIM’s general meeting and various regulatory bodies, including antitrust and investment law authorities.

ZIM is the tenth largest container shipping line globally. The merger would position Hapag-Lloyd as the fifth largest shipping line worldwide, with a fleet of more than 400 vessels, capacity exceeding 3m TEU, and annual transport volume of more than 18m TEU.

Subject to obtaining necessary regulatory approvals, the transaction is expected to be completed by the end of 2026.