MSC Group's strategic participation in HHLA

HHLA has been informed by its main shareholder, the Free and Hanseatic City of Hamburg (FHH), that the latter has reached agreement with Mediterranean Shipping Company S.A. (MSC) on a strategic participation in HHLA as part of an investor agreement. Immediately after receiving the information, HHLA published a corresponding ad hoc announcement on 13 September.

According to this agreement, the City of Hamburg will remain the majority shareholder. It intends to manage the company together with MSC and thus further develop HHLA. To this end, the City of Hamburg intends to hold a 50.1% stake in the future and MSC a stake of up to 49.9%. On 23 October 2023, MSC has made a voluntary public takeover offer for all issued Class A shares in HHLA at a price of EUR 16.75 in cash per Class A share.

On 6 November 2023, the Executive Board and the Supervisory Board of HHLA published a joint Reasoned Statement pursuant to Section 27 of the German Securities Acquisition and Takeover Act (Wertpapiererwerbs- und Übernahmegesetz, WpÜG). In this statement, both boards recommend to the shareholders to accept the offer.

At the expiry of the acceptance period, which was extended until 7 December 2023 at 24:00 hrs (CET), the takeover offer had been accepted by shareholders holding 7,325,366 Class A shares. This corresponds to 9.74 percent of the share capital. In addition, MSC has purchased 12.21 percent of the HHLA shares on the open stock market. Together with the Class A and S shares held by the City of Hamburg, the joint venture partners now hold 92.30 percent of HHLA's share capital. 

MSC's offer, which was published on 23 October 2023, relates to HHLA's listed A shares and thus concerns the Port Logistics subgroup with its three segments Container, Intermodal and Logistics. The offer also applies to the so-called S shares, which relate to HHLA's Real Estate segment and are not traded on the stock exchange. The Free and Hanseatic City of Hamburg (FHH), which indirectly holds all S shares, has concluded a binding agreement with MSC on the basis of which the S shares will not be sold and will therefore not become part of the strategic partnership between FHH and MSC. The Free and Hanseatic City of Hamburg will thus remain the sole owner of the S shares.

With the joint Reasoned Statement, the Executive Board and the Supervisory Board of Hamburger Hafen und Logistik AG (HHLA) evaluate the voluntary public offer made by Mediterranean Shipping Company (MSC) on 23 October 2023 pursuant to Section 27 of the German Securities Acquisition and Takeover Act (WpÜG). 
The Executive Board and the Supervisory Board are thus fulfilling their legal obligation to examine the offer impartially, carefully and unbiased – in the best interests of all stakeholders and thus of the company's employees, customers and shareholders.

The statement consists of two parts: Firstly, an assessment of whether the offer price of EUR 16.75 per share is adequate in financial terms; and secondly, an assessment of how the offer will affect HHLA in economic and strategic terms. As a result, the HHLA Executive Board and the Supervisory Board recommend to the shareholders to accept the offer.

Taking into account a Fairness Opinion prepared for the Executive Board and the Supervisory Board by Citigroup and the premium on the underlying stock market prices, analysts' estimates and own assessments, the Executive Board and the Supervisory Board consider the offer price of EUR 16.75 per share to be adequate. In negotiations with the City of Hamburg and MSC, the Executive Board and the Supervisory Board also reached extended commitments for the long-term development of HHLA as part of a binding preliminary framework agreement foregoing a Business Combination Agreement. In particular, this includes an additional equity commitment by the City of Hamburg and MSC totalling EUR 450 million for investments in HHLA's business operations over the coming years. In the joint Reasoned Statement, both boards therefore recommend to the shareholders to accept the offer.

The binding preliminary framework agreement is a binding preliminary agreement for a Business Combination Agreement (BCA) between HHLA, the City of Hamburg and MSC. The aim of this preliminary agreement is to reach a common understanding on key aspects related to securing HHLA and its business model in the long term. In the coming weeks, further discussions will be held on individual points of the BCA that have not yet been finalised in the binding preliminary framework agreement.

With the signing of the binding preliminary framework agreement, HHLA was able to reach extended commitments for the long-term development of the company. These include in particular:

• Subject to the approval of the Hamburg Parliament, the City of Hamburg and MSC will provide HHLA with additional equity capital totalling EUR 450 million for investments in business operations over the next few years following closing of the transaction.
• The neutrality and independence of HHLA's business model, in particular of the intermodal subsidiary Metrans, and thus the equal treatment of all customers will be ensured. All customers continue to have equal access to all HHLA terminals and services throughout Europe.   
• The neutrality and independence of HHLA's business model, in particular of the intermodal subsidiary Metrans, and thus the equal treatment of all customers will be ensured. All customers continue to have equal access to all HHLA terminals and services throughout Europe.  
• HHLA retains decision-making authority over its investment planning. In particular, the ongoing modernisation of HHLA's container terminals in Hamburg and the international expansion of the intermodal network in the coming years are thus secured. The City of Hamburg and MSC will support the corresponding investment plans totalling at least EUR  775 million in the years 2025 to 2028.
• Significant commitments were achieved for the employees, in particular the exclusion of redundancies for operational reasons for at least five years. Co-determination within the HHLA Group continues to be maintained.
• Ultimately, an understanding was reached on the continuation of HHLA's existing strategy. HHLA will thus remain a European logistics company. The planned sustainable reorganisation of the container segment and the expansion of the European intermodal network, in particular with regard to Metrans, will be driven forward with a focus on Hamburg.  

The final closing of the transaction remains subject to certain regulatory approvals that are set out in the offer document as well as the approval by the Parliament of the Free and Hanseatic City of Hamburg. Subject to the fulfilment of these conditions, closing of the transaction is currently expected to take place in the second quarter of 2024.

Pursuant to Section 16 of the German Securities Acquisition and Takeover Act (Wertpapiererwerbs- und Übernahmegesetz, WpÜG), HHLA shareholders who had not tendered their Class A shares by the end of the initial acceptance period on 20 November 2023 at 24:00 hrs (CET) were able to tender their shares until the end of the additional acceptance period on 7 December 2023 at 24:00 hrs (CET). After expiry of this period, shareholders who have not accepted the offer can continue to sell their shares freely on the stock market. 

The bidder will publish all necessary information on the takeover offer on the website www.poh-offer.de. In addition to the offer document, the website also contains a catalogue of questions and answers for shareholders (FAQ) as well as the mandatory notifications regarding the acquisition of shares from MSC on the stock exchange and the status of the shares already tendered in the context of the takeover offer. HHLA will publish the necessary information here on this page.

No. The closing of the transaction is subject to certain regulatory approvals as set out in the offer document, as well as the approval of the Parliament of the Free and Hanseatic City of Hamburg.

There will be no automatic delisting upon completion of the offer. A decision on a potential delisting can only be made after the transaction has been completed (closing) at the earliest. The exact conditions for a delisting are set out in Section 16 of the offer document (“Possible consequences for HHLA shareholders who do not accept the offer”). 

The closing of the transaction is subject to certain regulatory approvals as set out in the offer document, as well as the approval of the Parliament of the Free and Hanseatic City of Hamburg. Subject to the fulfilment of these conditions, closing of the transaction is currently expected to take place in the second quarter of 2024. 

The shareholding threshold of 95% required for a squeeze-out under stock corporation law has not yet been reached. Subject to the relevant shareholding threshold being reached, the City of Hamburg and MSC will have the required statutory majority of votes upon completion of the Transaction to enforce important structural measures under corporate law and other measures at HHLA's general meeting. Possible structural measures and their exact terms and conditions are described in more detail in Section 16 of the Offer Document.  

The binding preliminary framework agreement to the Business Combination Agreement (BCA), which was negotiated between HHLA, the City of Hamburg and MSC, regulates some of the relevant issues for HHLA and restricts possible structural measures for a certain period of time. For example, the BCA stipulates that HHLA is to remain in the legal form of a German stock corporation with a dualistic governance structure (Executive Board and Supervisory Board) until the end of 2026. 

Pursuant to Section 16 of the German Securities Acquisition and Takeover Act (Wertpapiererwerbs- und Übernahmegesetz, WpÜG), HHLA shareholders who had not tendered their Class A shares by the end of the initial acceptance period on 20 November 2023 at 24:00 hrs (CET) were able to tender their shares until the expiry of the additional acceptance period on 7 December 2023 at 24:00 hrs (CET). After expiry of this period, shareholders who have not accepted the offer can continue to sell their shares freely on the open stock market.

The closing of the transaction remains subject to merger control, subsidy control and foreign trade law procedures as well as the approval of the Parliament of the Free and Hanseatic City of Hamburg. Subject to the fulfillment of these conditions precedent, the transaction is currently expected to close in the second quarter of 2024. 

The Bidder will provide information on the website www.poh-offer.de as soon as individual procedures have been successfully completed. The settlement of the offer and the payment to the HHLA Shareholders who have tendered their shares will take place no later than on the seventh business day after the announcement that all closing conditions have been fulfilled. 

Until then, the tendered shares will remain in the securities account of the respective shareholder and will be listed under ISIN DE000A37FUD8. The tendered shares can continue to be traded on the regulated market of the Frankfurt Stock Exchange (Prime Standard) under this ISIN.
 

The tendered shares will remain in the securities account of the respective shareholder until the final settlement of the offer and will be listed under ISIN DE000A37FUD8.The shares with this ISIN can continue to be traded on the regulated market of the Frankfurt Stock Exchange (Prime Standard).

HHLA is a European logistics group in the legal form of a stock corporation. Currently 69.2% of HHLA's A-shares listed on the stock exchange (Port Logistics subgroup) are owned by the City of Hamburg, 30.8% are currently in free float. You can find more information here.

HHLA is one of the terminal operators in the Port of Hamburg. HHLA is also a leading European logistics company. With its dense network of seaport terminals in Hamburg, Odessa, Tallinn and Trieste, excellent hinterland connections for road and rail and interlinked intermodal hubs in Central and Eastern Europe, HHLA is the logistics and digital hub along the transport flows of the future.

Put in one sentence: HHLA's business starts at the waterfront, and takes place all over Europe. The business model relies on innovative technologies and is committed to sustainability.

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