Hapag-Lloyd extends IPO offering period by one week

The German ocean carrier is expected to price shares at the bottom of its initial range of 23 euros to 29 euros per share, according to multiple media reports.    Hapag-Lloyd is extending by a week the offering period for its initial public offering of stock in Germany, another sign the company’s plans to raise capital are not going as originally expected.
   The company had originally planned to end the offering period today, but said in a press release it is extending the period until Nov. 3.
   The Agence France-Presse news agency noted, “A number of stock market hopefuls have had to postpone or scale back their planned IPOs recently as a result of the market turbulence about the fallout from the economic slowdown in China and the Volkswagen emissions-cheating scandal,” pointing to Covestro, the former polymers division of Bayer, and auto parts supplier Schaeffler as examples.
   When Hapag-Lloyd announced plans for the public float on Sept. 28, the company said it expected gross proceeds in the amount of $500 million from the IPO – $400 million from the sale of newly issued shares to institutional and retail investors and $50 million each from Kühne Maritime and Compañía Sud Americana de Vapores (CSAV) who would place “cornerstone orders” of $50 million each. Hapag-Lloyd acquired the container business of CSAV last year.
   Then on Oct. 14, Hapag-Lloyd said it expected gross proceeds of $300 million, with Kühne and CSAV buying $30 million each. Another of its major shareholders, the tourism company TUI, might also sell 2.3 million shares plus around 1.9 million share for overallotments.
   Hapag-Lloyd said on Oct. 14 shares would be priced between 23 euros and 29 euros. Yesterday, however, a Reuters report said two unnamed sources told the news service Hapag-Lloyd was likely to price the IPO at the bottom of that range.
   That news came just after the world’s largest ocean carrier, Maersk Line, announced last Friday that it was lowering its profit projections for the year citing a deteriorating container market.
   Hapag-Lloyd, which said it got queries from after the Maersk announcement, issued a press release on Monday reiterating its outlook for the remainder of the year. “For the full year 2015 the outlook remains unchanged, Hapag-Lloyd is expecting a high single-digit EBITDA margin,” the company said.
   “Based on current trading, the EBITDA (earnings before interest, tax, depreciation and amortization) margin in September is expected to be in line with the information provided in the IPO prospectus for July and August,” said Hapag-Lloyd.