South Korea’s container transport firm Hanjin Shipping has signed an agreement with Swiss-based Mediterranean Shipping Company(MSC) to sell its stake in the US port operator that runs Long Beach’s largest terminal.
The latest move, which was approved by a South Korean court and the Port of Long Beach Harbor Commission, will see Hanjin selling its 54% stake in Total Terminals International LLC to MSC.
The financial terms of the deal were not available immediately, but reports said the stake in the terminal was earlier estimated to be valued at $344.5 million. The court said the value is expected to be made public after all party approval.
Under this deal, MSC will have sole control of the terminal lease since the company already holds the remaining 46% stake in the terminal operator. The agreement will also enable the operator to set up new cranes that can handle container vessels of up to 20,000 TEU.
Noel Hacegaba, the Long Beach port’s chief operating officer, said the deal would help the terminal to operate through the end of its lease term with the real potential for new business opportunities. TTI said the lease is for a minimum of $83.5 million a year.
Being the country’s biggest ports in terms of capacity, Los Angeles and Long Beach are handling a major chunk of imports and exports between the US and Asia.
Earlier, MSC had joined hands with Hyundai Merchant Marine for Hanjin’s share in the terminal, but Hyundai last week said it was pulling out of the joint bid and would take a minority stake in the terminal from MSC if it won the deal.
The sale of South Korean stake in the US terminal is in line with the company’s plan to sell its major assets as it faces liquidation following the bankruptcy in August this year. In November, Hanjin sold its business network and client information of Asia-US route to Korea Line Corp.