Economy Minister Nir Barkat Shifts Stance to Support Hapag-Lloyd's ZIM Buyout
Economy Minister Nir Barkat shifted his stance to support Hapag-Lloyd and FIMI's $4.2 billion acquisition of ZIM, following revised terms and security assurances.
The position of Economy Minister Nir Barkat regarding the acquisition of ZIM Integrated Shipping Services by Germany's Hapag-Lloyd and Israel's FIMI Opportunity Funds has undergone a significant shift. Despite the initial staunch opposition from professional staff within the Economy Ministry, Barkat now believes the deal can be approved and will ultimately benefit the national economy.
According to disclosures, Barkat's revised perspective followed a meeting with FIMI head Yishai Davidi, requested by the latter, and a restructuring of the acquisition terms agreed upon by Hapag-Lloyd and FIMI. The German shipping giant and the Israeli private equity fund signed an agreement in February to acquire ZIM for $4.2 billion.
Corporate Restructuring and the 'Golden Share'
Under the amended framework, FIMI will establish 'ZIM Israel' to satisfy the state's 'golden share' requirements, which mandate Israeli ownership and operational safeguards. While smaller than the current enterprise, the new local entity will hold 12 owned vessels and four chartered ships, compared to ZIM's current fleet of 99 vessels.
Barkat has instructed the ministry's professional division to reconvene with representatives from Hapag-Lloyd and FIMI after the Sukkot holiday to evaluate updated arguments. Should the professional staff be persuaded, it would pave the way for a revised official ministerial stance, marking a sharp departure from the position submitted in May.
Strategic Risks and Previous Objections
In May, the Economy Ministry's foreign trade administration, headed by Roy Fisher, issued a scathing critique of the takeover. The advisory opinion warned that the proposed structure posed direct risks to maritime trade and Israel's strategic and economic interests.
"The emerging sale structure poses a direct risk to maritime traffic and Israel's strategic and economic interests. The core of ZIM's activity is transferred to a German shipping giant partially owned by countries without diplomatic relations with Israel, while local operations are isolated within a new entity lacking an economically viable asset base for long-term survival."
Davidi, engaged in an intensive persuasion campaign, argues that ZIM's current exposure as a publicly traded company without a controlling core leaves it far more vulnerable to stealth accumulation by Qatari and Saudi investors, who can purchase up to 24% of shares on the open market without immediate disclosure.
Security Assessments and Labor Concerns
Beyond corporate structure, Barkat addressed labor implications and security clearances. Approximately 200 ZIM employees are slated to leave during the transition. Davidi assured the minister that departing staff would receive generous severance packages, mitigating labor opposition as a primary dealbreaker.
Following consultations with defense officials, including the Ministry of Defense's security authority (MALMAB), Barkat concluded that the transaction presents no national security vulnerabilities and that the restructured 'ZIM Israel' satisfies defense prerequisites.
Political fallout is anticipated, as other Likud-controlled ministries and state bodies have voiced strong reservations. Eight official entities must submit their positions to the Government Companies Authority by the end of the month. If deadlocks persist, the final decision will escalate to the full cabinet, potentially landing on the desk of a transitional government.
