Bundestag to vote on Hapag-Lloyd aid
A proposal to provide German government guarantees for $1.8 billion in loans to Hapag-Lloyd by its owners will probably be decided by Germany’s Bundestag today.
A decision on the proposal was delayed this week by German lawmakers who wanted to clarify issues related to the owners’ request, which lawmakers described as “opaque” on Wednesday.
Hapag-Lloyd’s owners include TUI AG, which owns 43.3 percent, and the Albert Ballin consortium, which controls 56.7 percent.
Chancellor Angela Merkel’s coalition has tied help for banks tapping the country’s $699 billion bank rescue fund to restrictions on top executives’ pay and temporary restrictions on dividends, Bloomberg reported.
Annual pay for board members that exceeds $727,000 is “not appropriate”, according to an ordinance that followed the legislation.
TUI AG, which after selling a majority stake in Hapag earlier this year still holds 43 percent in the container line, paid $5.5 million last year to Chief Executive Officer Michael Frenzel, according to the company’s annual report. All other board members also received more than $727,000 each.
Hamburg-based Hapag-Lloyd applied for loan guarantees worth $1.8 billion to a $167-billion federal fund set up by the coalition. The fund has different conditions than the bank rescue fund. Hapag’s owners injected $458 million of their own cash into the business in August.
The shipping line, Germany’s biggest container fleet, filed for aid on Aug. 14. Hapag was advised by the federal government to modify the criteria for gaining aid to include providing more funds from its owners and starting a cost-cutting program to save as much as $1.5 billion.
A decision on the proposal was delayed this week by German lawmakers who wanted to clarify issues related to the owners’ request, which lawmakers described as “opaque” on Wednesday.
Hapag-Lloyd’s owners include TUI AG, which owns 43.3 percent, and the Albert Ballin consortium, which controls 56.7 percent.
Chancellor Angela Merkel’s coalition has tied help for banks tapping the country’s $699 billion bank rescue fund to restrictions on top executives’ pay and temporary restrictions on dividends, Bloomberg reported.
Annual pay for board members that exceeds $727,000 is “not appropriate”, according to an ordinance that followed the legislation.
TUI AG, which after selling a majority stake in Hapag earlier this year still holds 43 percent in the container line, paid $5.5 million last year to Chief Executive Officer Michael Frenzel, according to the company’s annual report. All other board members also received more than $727,000 each.
Hamburg-based Hapag-Lloyd applied for loan guarantees worth $1.8 billion to a $167-billion federal fund set up by the coalition. The fund has different conditions than the bank rescue fund. Hapag’s owners injected $458 million of their own cash into the business in August.
The shipping line, Germany’s biggest container fleet, filed for aid on Aug. 14. Hapag was advised by the federal government to modify the criteria for gaining aid to include providing more funds from its owners and starting a cost-cutting program to save as much as $1.5 billion.