The merger between Hapag-Lloyd and United Arab Shipping Company (UASC) was given conditional approval on November 23, reported Reuters.
The newly formed company will become the world’s fifth largest shipping line, worth approximately US$8 billion.
In a statement, the Commission said: “Both companies operate in the container liner shipping sector,”
“The clearance is conditional on the withdrawal of UASC from a consortium on the trade routes between Northern Europe and North America, where the merged entity would have faced insufficient competitive constraint.”
This concession was made by UASC earlier in November, in a bid to push the EU over the line and approve the merger. It followed other concessions made by the two carriers in October, aimed at overcoming any antitrust hurdles the EU might have raised.
With this clearance, Hapag-Lloyd and UASC become the latest carriers in an ever-growing list to either merge or form an alliance in a bid to stave off the challanges of industry oversupply and persistently low freight rates.