Israeli Shipping Authority Opposes Zim Sale to Hapag-Lloyd
Israel's Shipping and Ports Authority has officially urged government ministers to reject the proposed sale of the Israeli shipping company Zim to the German firm Hapag-Lloyd. In a letter sent Tuesday to relevant ministers, Shipping Authority Director Zadoc Redker stated that despite extensive review and assurances from the parties involved since February, the core concerns about the deal remain unaddressed. The authority argues the transaction would not strengthen Israel's strategic position, nor would it create a stronger independent Israeli shipping company. Instead, it would replace an existing global Israeli company with a smaller entity operating fewer ships, with a reduced footprint and increased reliance on foreign control, ultimately weakening Israel's national maritime capabilities.
The authority also raised concerns about actual control of the company, noting that while formal ownership might be Israeli, Hapag-Lloyd is expected to control most of the essential operational mechanisms. This distinction between formal and practical control means that even with Israeli shareholders, strategic command over the company's key functions would lie with the German firm. The Shipping Authority indicated that most involved government ministries, including Defense, Economy, Agriculture, and Transportation, have already expressed opposition to the deal in its current form, while the Finance Ministry has yet to finalize its position.
Prime Minister Benjamin Netanyahu and Defense Minister Israel Katz have publicly opposed the deal in the past month. The Shipping Authority believes there is no valid reason to further delay a decision, warning that continued inaction could lead to prolonged deferral. Their recommendation is to oppose the deal and utilize the state's special share powers to block it. Hapag-Lloyd announced its intention to acquire Zim for $4.2 billion about six months ago. The proposed structure involves Hapag-Lloyd taking over Zim's international operations, with the Israeli operations, dubbed 'New Zim,' owned by the FIMI fund. While Zim shareholders approved the sale, regulatory approvals, particularly from Israel holding a 'golden share,' are still required.
