The Honolulu-based shipping company also announced this week that it raised $75 million through a private placement of 11-year final maturity senior unsecured notes.
Matson, Inc. said it has began calling the Port of Naha, Okinawa and dropped a call to Xiamen, China on its China-Long Beach Express (CLX) service.
The Honolulu-based shipping company’s CLX will now have a rotation of Long Beach, Honolulu, Guam, Naha, Ningbo, Shanghai and Long Beach.
The last direct call to Xiamen will be Sunday, Feb. 5. Matson will keep its office in Xiamen to continue serving customers in the Chinese city with transshipment via Shanghai.
“Historically, the Xiamen call has accounted for the smallest portion of overall CLX China volumes, with those Xiamen cargoes gradually declining,” said Michael Webber, a senior analyst at Wells Fargo Securities.
“Adding Naha allows us to provide the fastest service to an important locale for the U.S. government without diminishing our eastbound CLX capacity out of China,” said John Lauer, senior vice president, Ocean Services at Matson. “The westbound transit time from Long Beach to Naha will save shippers up to four days on existing services in the market.”
Meanwhile, the CLX is seeing competition heat up in Guam due to APL doubling the frequency of its GSX loop, which also calls the U.S. island territory.
In addition to doubling its frequency to become a weekly service, APL said its GSX loop is adding Yokohama this month, resulting in a revised rotation of Busan, Yokohama, Guam, Saipan and Busan. In Yokohama, the GSX and APL’s Eagle Express Service between the U.S. West Coast and Asia offer connecting service. APL launched the GSX last year.
Webber said the modified CLX Service “offers diversification amid rising headwinds. Overall, we believe the modified service offering is a positive development for MATX (Matson), as it should help support westbound CLX volumes amid modest headwinds that include increased Guam competition and a soft transpac freight rate backdrop, while MATX continues to maintain its transit time advantage in support of its CLX service premium.”
Matson also announced this week that it raised $75 million through a private placement of 11-year final maturity senior unsecured notes.
Joel Wine, Matson’s senior vice President and chief financial
officer said, “We are pleased to complete this attractive fixed
rate financing that will pay down our revolving credit facility and
strengthen our balance sheet as we progress with our four-vessel Hawaii
fleet renewal program. We expect to fund the construction of these
vessels primarily through the strong cash flows generated by our core
businesses, available capacity under our $400 million revolving credit
facility, and additional debt financings, which could include Title XI
U.S. Government guaranteed vessel finance bonds.”
The notes will have a weighted average life of approximately eight years and will bear interest at a rate of 3.37 percent, payable semi-annually.
Matson adds Okinawa to transpacific loop
