Hapag-Lloyd AG and Compania Sud Americana de Vapores S.A. (SNSE:VAPORES) merger is expected to be signed by early February 2014, according to people familiar with the matter, as both sides haggle over the shareholding structure in the prospective combined company. “If no major disagreements emerge, we should have [a memorandum of understanding] signed within the next three weeks or so,” said one person familiar with the talks. The two sides are still negotiating how much each will hold in the merged entity and whether CSAV's ships will be part of the deal or be leased to Hapag-Lloyd, this person said.

If an MOU is signed the companies will then proceed to due diligence and the merger could be completed in the first quarter. Under current talks, the Luksic family, Compania Sud Americana de Vapore's main shareholder, will become a major holder in Hapag-Lloyd with a stake close to that of Klaus-Michael Kühne, who owns 28% of the Hapag-Lloyd, according to another person involved in the deal. The Luksics started buying into Compania Sud Americana in 2011 and now control 46% of the company.

Hapag-Lloyd AG will control 70% of the merged entity, with Compania Sud Americana owning the remainder, based on current discussions. According to Wall Street Journal, Hapag-Lloyd and CSAV declined to comment on the progress of the talks.