Kien Hung attracts another buyer

Alan Peat AS THIS issue went to press on Monday (March 10), Kien Hung Line was reported to have signed a deal with another buyer after the CP Ships acquisition - which was reported around the world on the internet - fell through. Although no information has been released to FTW directly by Kien Hung Line, a Taiwanese source leads us to understand that an agreement has been reached with the German line, Hamburg Sud. The acquisition is believed to be a takeover of the KH name, lease contracts, equipment and all staff - and the price we have heard is US$35-million, plus US$10-m for equipment. However, according to our source, all the line’s 19-vessel fleet will still belong to KH founders, the Shih family - who are believed to have arranged a three-year charter deal with Hamburg Sud. Kien Hung has recently been faced with financial difficulties, with strong competition on its trades to SA, South America and West Africa adding to the problem. However, the source added, in the terms of the deal, the financial pressure on KH will now be relieved and the line will have a financially sound investor coming in. The KH name will continue, and - with the Hamburg Sud money backing it - is expected to be in a better competitive position, according to the FTW contact. While it is still unknown what will happen with KH’s membership of Super GEX (Sgex) in the long-term, in the short-term the tie-in with the consortium should continue until September - the first anniversary of its joining, and when the future position can be decided. It is also not officially known what will happen to United Ships Agency - the SA agents for the line - which would also be taken over in the same deal. But our source leads us to believe that all current agencies and their staff will continue to service the line - although there may be a name change under the new deal.