Fleet will still belong to Shih family Alan Peat THE BOARD of CP Ships is currently approving the purchase of Kien Hung’s liner operations, a deal reported to be priced at US$35-million, plus US$10-m for equipment. Kien Hung has recently been facing financial difficulties, with strong competition on its trades to SA, South America and West Africa adding to the problem. However, according to a Taiwanese source, the line’s 19-vessel fleet will still belong to the Shih family who are believed to have arranged a three-year charter deal with CP. Also, 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 CP 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 will continue until September, the first anniversary of its joining, and when the future position will 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 the agency and its staff will continue to service the line in this country although it may very well change its name. CP Ships and its operating units currently deploy a combined fleet of 89 ships with a total capacity of 194 000 twenty foot equivalent units (TEUs), according to the BRS-Alphaliner Top 100. If the deal is approved, CP will control eight operating units - with KH added to the current list of ANZDL, CanMar, Cast, Contship, Lykes Lines, TMM and Italia. Also, added Alphaliner, it will strengthen CP’s presence on the SA and South American trades - with SA currently served by Lykes, and South America mainly by Lykes, TMM and Italia. The CP board is expected to finalise its decision by today (March 7).
