UPDATE 1-Hapag-Lloyd to strike deal to buy Vapores in January - Welt

Sun Jan 12, 2014 12:52pm EST

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(Adds Vapores declines to comment)

FRANKFURT Jan 12 (Reuters) - German container shipping company Hapag-Lloyd is nearing a deal to buy Chilean shipper Compania Sud Americana de Vapores, a German newspaper reported.

"We want to reach an agreement by the end of January," a Hapag-Lloyd manager told Die Welt, according to a pre-release of its Monday edition.

Vapores, which has a market capitalisation of $845 million, confirmed in December that it had entered merger talks with Hapag-Lloyd, as it is grappling with steep losses caused by low freight rates, high fuel prices and expensive leases.

Under the deal, Vapores will take a 30 percent stake in Hapag-Lloyd, the newspaper reported, adding that it was still unclear whether Vapores' 54 ships will be part of the transaction or whether they will just be leased to the German peer. Hapag-Lloyd has 152 ships on its own.

Both Hapag-Lloyd and Vapores declined to comment.

Earlier this year, the owners of unlisted Hapag-Lloyd called off a planned merger with rival German shipper Hamburg-Sued because terms could not be agreed.

At the time, major Hapag-Lloyd shareholder Klaus-Michael Kuehne had said the combination between the German peers was attractive, arguing it made sense to bolt Hapag's Asia focus to Hamburg-Sued's strength on South American routes.

In the newspaper report Kuehne is quoted as saying: "I see good chances of clinching a deal (with Vapores)."

The Luksic family, Chile's richest and Vapores' main shareholder since a $1.2 billion capital increase, is happy to hold a minority stake in the merged group, the paper quoted a person familiar with family. (Reporting by Arno Schuetze; additional reporting by Jan Schwartz and Alexandra Ulmer, editing by William Hardy and Rosalind Russell)

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