Shipping circles in Hamburg are abuzz with speculation that the Oetker family will announce this week that it intends to sell the Hamburg Süd container business after more than 60 years.
The baking goods dynasty is rumoured to have finally given up on turning the business around after continued losses on its traditional north-south routes and a disastrous entry into the Asia- North Europe trade. It is understood that a meeting took place yesterday of the controlling members of the Oetker family at a secret location, after receiving a firm offer for the Hamburg Sud container business.
But as yet there is no white smoke emerging from the carrier’s offices in Willy-Brandt-Strasse and the company declined to comment “because of principle”.
However, one Hamburg broker told The Loadstar yesterday Hamburg Süd “had nowhere to go” after the latest round of mergers and acquisitions in liner shipping had left the carrier alone and unable compete against the new mega-alliances.
He said many in Hamburg were facing the prospect of the loss of a shipping icon; one which celebrated its 140th anniversary in 2011, itself scooping up major liner names such as Furness Withy, Alianca and Ellermans in the past two decades.
Hamburg Süd more recently invested heavily in a futile attempt to extend its global status through a raft of co-operation agreements, the biggest of which was with UASC, now expected to be acquired by compatriot Hapag-Lloyd before the year ends.
In September 2014, chairman Dr Ottmar Gast said: “This co-operation will enable Hamburg Süd and UASC to complement each other’s core services and networks, offering both lines’ customers a more comprehensive global reach and reliable services without incremental investment in new tonnage.”
The deal meant Hamburg Süd could fulfill a long-held ambition to enter the Asia-North Europe and Asia-US trades, thus becoming a true world player in the liner industry. In turn, the ambitious UASC was able to put its toe in the water of the then more lucrative Europe-South America east coast and Asia-SAEC trades.
Unfortunately for Hamburg Süd, its entry coincided with periods when Asia-Europe freight rates plunged to record lows caused by cut-throat competition. As a consequence it was, according to anecdotal reports, obliged to accept bookings at rates barely half the slot costs, and on some voyages even paid for unused slots.
One Hamburg Süd executive told The Loadstar last year that its involvement in the Asia trade had been “an unmitigated disaster”.
Analysts seem to be in general agreement that Maersk is the firm favourite to buy Hamburg Süd – on the basis that: it can; it was beaten by CMA CGM and Hapag-Lloyd respectively for APL and UASC; and, not least, that with the exception of MSC which has always opted for organic growth, no other carrier has deep enough pockets to meet the expected $4bn price tag.
Source: The Loadstar