The Zim deal was signed, and the final value was revealed

The fact that Pegg-Lloyd, the fifth largest transport company, is seeking to purchase Zim was revealed in Globes last December. The deal will be financed from the Pegg-Lloyd’s own sources, alongside external financing of up to 2.5 billion dollars. Samer Haj Yahya, former chairman of Bank Leumi, acts as the representative of Hafg-Lloyd and is considered the architect of the deal. Following the official announcement of the signing of the deal, shares The Peg-Lloyd Currently falling during trading on the Frankfurt Stock Exchange by over 7%.

Hafg-Lloyd continued to visit Israel’s ports even during the war and has been considering the purchase of Zim ever since. According to estimates, it is expected to operate in Israel and sees the possibility of benefiting from Israeli high-tech in the contexts of cyber, naval defense and fintech for example. According to the Peg-Lloyd announcement, the merger between the companies is expected to strengthen its position, with a modern fleet of over 400 vessels, a capacity of 3 million TEU (containers) and an annual transport volume of over 18 million TEU. As for the “Golden Stock” issue – sources estimate that there should be no problem in approving the split, because the new Zim, which will be maintained by Fimi, will meet the required criteria and even more than what is required.

The purchase comes after a strategic review process conducted by the ZIM board of directors, led by Yair Sarosi, after rejecting two offers to purchase the company submitted by ZIM CEO Eli Glickman, together with businessman Rami Unger. The purchase deal is subject to various approvals, including the approval of the state, which owns a “golden share” in ZIM. Already yesterday, amid publications regarding the transaction, Galit Viderman sent, A senior deputy to the director of the Companies Authority, a letter to Serousi in which she wrote that the party intending to purchase Zim shares should contact the Government Companies Authority, as required in accordance with the provisions of the state shares, along with all the information.

She further added that the intention to split Zim should be specified and the status of the split should be addressed in accordance with the instructions of the Gold Stock. The intention is that there are two buyers in the transaction: the Fimi Fund, led by Yishai Davidi, is expected to purchase all activities related to Israel, the company’s headquarters and responsibility for the relationship with the state, along with hundreds of ZIM employees and 16 ships owned by the company; Whereas Heg-Lloyd will receive a number of Zim’s shipping lines, dozens of ships under lease and employees relevant to its lines. We should note that Zim’s workers’ committee, incorporated in the Histadrut, already announced yesterday a 48-hour warning strike at the company’s headquarters in Israel.

Yishai Davidi: “Strategic opportunity to establish a strong Israeli shipping company”

“ZIM is an excellent partner for Hapag-Lloyd,” said Rolf Haben Jansen, CEO of Hapag-Lloyd. “Customers will benefit from a significantly strengthened and upgraded network of trade routes in the Pacific Ocean, the Atlantic Ocean, within Asia, Latin America and the Eastern Mediterranean. We share the same aspirations for exceptional customer service, superior operational quality and a commitment to digital innovation, all thanks to the expertise and passion of our people around the world. We will use this opportunity to create the best team from the extraordinary talents of Zim and Afge-Lloyd in Israel and around the world and we commit to building a significant and long-term presence in Israel. Together, we will set new standards of excellence and secure our position as the undisputed leaders of quality in our industry.”

Eli Glickman, president and CEO of Zim, said: “I am very proud of the strategic transformation we have carried out at Zim in recent years, which has created extraordinary value for shareholders. Since I joined the company in 2017, Zim has gone from negative equity to an industry leader with strong financial and operational performance. Since the IPO in January 2021, we have distributed dividends to shareholders in the aggregate amount of $5.7 billion. Upon completion of the deal, the total capital returned to the shareholders will be approximately $10 billion, which is more than five times the company’s market value five years ago and 45 times the capital raised in the IPO.” Glickman concluded: “Our agility and proactive decision-making have allowed us to implement critical strategies that position Zim as a market leader in the container shipping industry, with one of the highest EBIT rates in the industry, and made Zim an attractive acquisition target.”

Yair Sarosi, Chairman of the ZIM Board of Directors, stated that “Today’s announcement is the culmination of an in-depth and thorough strategic review conducted by the ZIM Board of Directors, with the aim of maximizing the value for shareholders. The decision reflects the comprehensive evaluations of all the options that were on the table, to ensure the best result for the company’s investors. We believe that this is the most responsible and profitable transaction for all Zim stakeholders and it reflects the enormous and impressive value creation we have established since our IPO.”

Yishai Davidi, founder and CEO of the FIMI Foundation, stated that “FIMI recognizes and believes in the strategic importance for the State of Israel of an independent and strong Israeli shipping company. We are establishing a stable Israeli company, the new ZIM, and see Hafg-Lloyd as a significant strategic partner for its continued activity. We intend to build an advanced and efficient fleet, with broad logistics capabilities, and see this as a strategic opportunity to establish a strong, efficient and focused Israeli shipping company with financial strength, which will operate in cooperation with one of the leading shipping companies in the world.

“The new Zim will integrate significant transatlantic capabilities, alongside additional shipping routes to Europe, Africa, the Mediterranean Sea and the Black Sea, while basing itself on advanced maritime transport capabilities and placing the customer at the center of its activities. Fimi intends to leverage its experience and capabilities to lead the new Zim to operational stability and uncompromising quality, with a deep commitment to employees, suppliers and customers.”