Hapag-Lloyd's week got better and worse at once: the German carrier raised its full-year earnings guidance on Monday for the second time this year , even as Israeli authorities closed the door on the current structure of its $4.2 billion bid for ZIM and told the parties to start over.
The Hamburg-based container shipping company said it now expects group EBITDA of $3.9 billion to $4.4 billion for 2026, up from a previous range of $2.7 billion to $3.7 billion, and group EBIT of $1.25 billion to $1.75 billion, up from a range of roughly $100 million to $1.1 billion.
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The ocean carrier attributed the increased outlook to strong market demand and higher spot freight rates. The company highlighted that the forecast is subject to a high degree of uncertainty due to the volatility of freight rates and geopolitical challenges.
Last month, when Hapag-Lloyd posted its second quarter earnings, the average freight rate increased 11 percent on a sequential basis to $1,475 per 20-foot equivalent unit (TEU). Across the board, freight rates have remained elevated since the close of the quarter. According to the Drewry World Container Index, the average cost to move a 40-foot container is $4,468, down 3.7 percent from July 2 but still up 135.3 percent compared to Feb. 26—days ahead of the start of the war in Iran.
The carrier's upgrade follows the lead of Gemini Cooperation partner Maersk, which raised its 2026 guidance for the second time this year in August on the back of the strong container demand, lifting underlying EBITDA to $10.5 billion to $12.5 billion, from $8 billion to $10 billion. Citing the same reasons as their competitors, Ocean Network Express (ONE) also upwardly revised its outlook that month, tripling its prior profit forecast from $300 million to $900 million.
Hapag's earnings strength comes amid a regulatory shakeup that casts its deal for Israel -based ZIM in doubt.
Israel's Government Companies Authority (GCA), which oversees state-owned businesses and their privatization processes, informed ZIM on Tuesday that it ended its review of Hapag-Lloyd's pending application.
Hapag-Lloyd and Israel-based private equity partner FIMI Opportunity Funds had signaled their intention to submit a revised proposal for post-closing operations on Sept. 24, but failed to deliver the necessary details by the deadline the GCA had set for responses to its information request, according to the letter viewed by Israeli business publication Calcalist.
According to Israeli business publication Globes, Hapag-Lloyd said it intends to finalize the business plan and full legal framework within 45 days and present the improvements to Israel's Finance Ministry.
The revised structure reportedly keeps the $4.2 billion price tag, which the buyers say now addresses security concerns and is designed to "strengthen Israel's maritime independence, national security, and the resilience of its supply chain infrastructure."
The GCA told ZIM that any new proposal would have to be filed in full detail to enable an informed decision, a Wednesday SEC filing said.
The deadline for satisfying the deal's conditions is February 2027, with a possible extension to June 2027 if the authority's approval is the only outstanding condition.
As part of the initially proposed deal, Hapag-Lloyd would acquire ZIM while FIMI would take ownership of a carved-out Israeli container business, New ZIM. FIMI would take control of ZIM's 16 owned vessels so that Hapag-Lloyd could remain compliant with Israel's "golden share" provision, which designed to protect the country's interests in private companies deemed essential for national security.
ZIM shareholders approved the deal on April 30.
The combination would bring together the operations of the world's fifth and 10th largest ocean carriers by tonnage capacity. Combined, the carriers would operate more than 400 vessels with capacity above 3 million TEUs.
However, it had seen growing opposition from both the Israeli government and ZIM employees namely due to new foreign stakeholders including Qatar and Saudi Arabia, whose public funds would own more than 22 percent of the company's shares.
That opposition has hardened in recent days, with the Finance Ministry sending a 33-page position paper to the GCA recommending against approval of the current structure.
"It is evident that the deal entails a series of material risks that are not adequately addressed in the existing agreements," the paper said, concluding that New ZIM's chances of becoming an independent, competitive shipping company had "a low probability of success."
Israeli state opposition is the one way the deal can fall through without Hapag-Lloyd paying ZIM a $160 million termination fee.
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