Hapag-Lloyd has assured that it has no plans to carry out massive layoffs at ZIM Integrated Shipping Services, in an attempt to reduce the tension generated by the strike that the workers of the Israeli shipping company have intensified in light of uncertainty about the security of their jobs.
"All employees of ZIM's headquarters and its management team will receive a job guarantee for a defined period following the shutdown of operations, which will be negotiated in good faith and with appreciation alongside the respective labor representatives. Israel will remain a solid location for the combined business of ZIM and Hapag-Lloyd," said Rolf Habben Jansen, CEO of Hapag-Lloyd, in a statement released this Tuesday.
The statements come in a context of increasing labor conflict. According to Reuters, around 800 of the 1,000 unionized employees of ZIM supported the strike this Tuesday, which resulted in the halting of operations at the company's headquarters in Haifa and the interruption of port activities in the ports of Ashdod and Haifa. Union representatives indicated that vessels already docked would not be unloaded.
The strike was triggered after Hapag-Lloyd announced its intention to acquire ZIM for an amount of 4.2 billion dollars. In a related transaction, the private equity fund FIMI Opportunity Fund, based in Tel Aviv, will acquire a separate business unit that will operate 16 vessels to maintain dedicated maritime connections for Israel under the name "New ZIM." Union representatives have expressed concern over the possibility that the new entity will employ only 120 people, which could leave hundreds of workers without jobs.
According to Hapag-Lloyd, Oren Caspi, chairman of the ZIM workers' committee, met last night with Eli Glickman, CEO of the Israeli shipping company, who received a mandate from both the board of directors and Hapag-Lloyd to open negotiations with the workers.
The acquisition operation, which still requires approval from ZIM shareholders and Israeli authorities, took the market by surprise, as several other container shipping lines had been mentioned as potential buyers. Hapag-Lloyd confirmed the operation on Sunday, a day before formally announcing the signing of the agreement.
The German shipping company expects to generate up to 500 million dollars in annual synergies, mainly through optimizing its service network and efficiencies in procurement. During a conference with investors held on Tuesday, Habben Jansen noted that ZIM has approximately 6,700 highly qualified professionals and added that the operation will allow Hapag-Lloyd to access a broader talent base.
Hapag-Lloyd's acquisition of ZIM represents one of the largest corporate operations in the container shipping sector in recent years. The integration of both companies would create an operator with a large combined fleet, at a time when the sector is undergoing a consolidation period marked by the reorganization of shipping alliances and the pursuit of economies of scale. The outcome of labor negotiations in Israel will be crucial for the timeline and final conditions of the operation.