Container Shipping Line Joins Freight Alliance Cooperative to Finally Satisfy Bankers

KOREA – WORLDWIDE – After weeks of speculation, months of negotiations, and years of financial trouble, Korean container shipping line Hyundai Merchant Marine (HMM) is on the way to fulfilling its final obligation to the restructuring terms it agreed with its bankers by joining a global shipping alliance. HMM says it is completing talks with the world’s top two container freight firms, Maersk Line and the Mediterranean Shipping Company (MSC) which together comprise the 2M Alliance, in a deal that until lately looked to be in some trouble following recent announcements by Maersk.

Under the name 2M+H Strategic Cooperation, the agreement is a combination of slot exchanges and slot purchases between the three parties, as well as Maersk Line and MSC taking over a number of charters and operations of vessels currently chartered to HMM. The cooperation is outside the scope of MSC and Maersk Line’s 2M vessel sharing agreement, however it will provide Korean group HMM access to the 2M network. The agreement is scheduled to begin in April 2017 subject to regulatory approval.

In a statement HMM said that the 2M+H Strategic Cooperation collaboration methods are similar to the previously adopted O3 Alliance and that moreover, the 2M+H Strategic Cooperation has exclusivity against other alliances, and is binding for an initial period of three years. The Basic Slot Allocation (BSA) offers HMM an increased port reach of around 20% compared to the G6 alliance, of which the Korean firm was previously a member before being squeezed out, principally by the presence of CMA CGM owned APL.

Ironically talks with the 2M members began when HMM failed to join THE Alliance earlier this year due to pressure from fouder member and fellow countrymen Hanjin Shipping, which then promptly collapsed financially. Maersk Line says that this latest cooperation will provide new opportunities, not least in the transpacific trade where 2M will get access to strong HMM products. Søren Toft, Chief Operating Officer, Maersk Line, said:

“We are pleased to enter into this strategic cooperation with Hyundai Merchant Marine, Korea’s leading container carrier. It will enable us to enhance our 2M network and presence in the important Transpacific trade. We look forward to leveraging these new opportunities to the benefit of our customers.”