Five International Firms Advise on $6 Billion Sale of German Shipping Unit

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Saturday, 28 March 2009

In the midst of last fall's economic collapse, it appears The Am Law Daily missed a pretty big deal--German tourism giant TUI AG's announcement that it would sell a majority stake in its Hamburg-based shipping unit Hapag-Lloyd to an investor group . The proposed deal was initially valued at roughly $3.3 billion, but the credit crisis threw a monkey wrench into the matter--TUI was forced to keep a 43.33 percent stake (rather than a 33.33 percent stake) in Hapag-Lloyd, the world's fifth-largest maritime transportation company.
TUI also agreed to provide additional credit facilities to prop up Hapag-Lloyd in order to finalize a sale earlier this week to a Hamburg-based consortium. The deal now is valued at $6 billion.
Five international firms--Freshfields Bruckhaus Deringer, Latham & Watkins, Milbank, Tweed, Hadley & McCloy, White & Case, and Wilmer Cutler Pickering Hale and Dorr--advised various parties on the transaction.
Götz Wiese, the managing partner of Latham's Hamburg office, led a team advising the Albert Ballin KG consortium on its acquisition of a 56.67 percent stake in Hapag-Lloyd. M&A partner Stefan Widder in Hamburg and finance partner Andreas Diem in Munich also served as outside counsel to the consortium.
"The volatility of the financial markets has impacted the maritime shipping industry, making this deal particularly challenging," said Wiese in a statement released through the firm. "In light of market conditions, we are pleased that our corporate and tax advice have contributed to the successful completion of this transaction."
The consortium includes the City of Hamburg and its HGV holding company, Hamburg-based HSH Nordbank, Hamburg-based private investment bank M.M. Warburg, and insurance companies Signal-Iduna and HanseMerkur. German shipping magnate Klaus-Michael Kühne--chairman of Swiss freight and logistics firm Kühne + Nagel International--is also part of the acquiring consortium.
Freshfields M&A partner Marius Berenbrok, based in Hamburg, advised the city's HGV holding company on the deal. HSH Nordbank was advised by Hamburg-based White & Case M&A partners Eberhard Meincke and Matthias Stupp and finance partner Kai-Michael Hingst. Frankfurt-based finance partner Thomas Ingenhoven from Milbank also advised HSH Nordbank.
TUI was advised by M&A partners Hans-Jörg Ziegenhain and Daniel Wiegand from the Munich office of German firm Hengeler Mueller. Roland Steinmeyer, chair of the German corporate practice at Wilmer in Berlin, also advised TUI along with M&A counsel Matthias Santelmann.
The sale will help TUI shore up its balance sheet. The Hannover-based company posted a 2008 net loss of $163 million on Wednesday.
Baker & McKenzie and Sullivan & Cromwell had advised Singapore-based shipping container company Neptune Orient Lines in a failed bid for Hapag-Lloyd last fall. With shipping companies increasingly at risk from hostile takeovers, perhaps they'll get another chance sometime soon.
Source: Am Law Daily