Status of Horizon Lines breakup

I came across an article in regards to the breaking up of Horizon lines. Once being the leader of domestic ocean shipping and integrated logistics for Hawaii is now being disintegrated. It is said they are selling to its competitor The Pasha Group. Any reasoning as to why they are selling?

Where have you been?

Not all is being sold to Pasha. The short version is, Horizon lines got rid of their Puerto Rico service–nobody is buying that part, it’s just going away. Crowley and Sea Star will probably take up most of that capacity. Matson is buying their Alaska service. Pasha is taking over the Hawaii stuff. I haven’t heard anything as far as what ships Matson and Pasha plan to keep running, if they’ll look to bring in replacement tonnage, and particularly in the case of Pasha, whether that run will go over to AMO from MM&P/MEBA. Also I’m not sure if the actual transfer has gone through, or what.

CBA digging it up myself but if you do a quick search for Horizon there was a pretty big thread about it a few months back–I think it was in the Maritime News forum somewhere.

[QUOTE=awulfclark;160697]Not all is being sold to Pasha. The short version is, Horizon lines got rid of their Puerto Rico service–nobody is buying that part, it’s just going away. Crowley and Sea Star will probably take up most of that capacity. Matson is buying their Alaska service. Pasha is taking over the Hawaii stuff. I haven’t heard anything as far as what ships Matson and Pasha plan to keep running, if they’ll look to bring in replacement tonnage, and particularly in the case of Pasha, whether that run will go over to AMO from MM&P/MEBA. Also I’m not sure if the actual transfer has gone through, or what.

CBA digging it up myself but if you do a quick search for Horizon there was a pretty big thread about it a few months back–I think it was in the Maritime News forum somewhere.[/QUOTE]

It was announced in at least one other trade news website that Pasha will partner with Crowley’s Marine Transport Management operation to manage the operation and crewing of the Horizon Lines ships. As the DOJ has given the green light for the acquisition rumor has it for the hand over to occur in June or not long after.

[QUOTE=Traitor Yankee;160696]Where have you been?[/QUOTE]

More like what planet has he been on?

Once being the leader of domestic ocean shipping and integrated logistics for Hawaii is now being disintegrated.

With the exception of the not-as-ancient Alaska trade ships, HL was nothing more than the smallest , least useful old US lines ships that USSM/MLL didn’t want after Sea-Land officially disappeared. Laying up the Horizon Discovery (1969) in Orange/Beaumont TX in Feb 2013 (to be broken out again a year later) and have the Horizon Navigator (1972) take her place isn’t exactly what I call being a leader of domestic ocean shipping.

[QUOTE=Johnny Canal;160736]More like what planet has he been on?

With the exception of the not-as-ancient Alaska trade ships, HL was nothing more than the smallest , least useful old US lines ships that USSM/MLL didn’t want after Sea-Land officially disappeared. Laying up the Horizon Discovery (1969) in Orange/Beaumont TX in Feb 2013 (to be broken out again a year later) and have the Horizon Navigator (1972) take her place isn’t exactly what I call being a leader of domestic ocean shipping.[/QUOTE]

The Reliance, Spirit, Consumer and Producer (currently laid up) were never US Line ships.

Horizon had combined losses of $218,224,000 during 2012-2014… That may have something to do with their liquidation.

[QUOTE=Chief Seadog;160746]The Reliance, Spirit, Consumer and Producer (currently laid up) were never US Line ships.[/QUOTE]

Okay, maybe not, but the point remains that the [I]Tacoma[/I], the [I]Anchorage[/I], and the [I]Kodiak[/I] were the newest ships Horizon had in their stable. Those were built in the mid-to-late 80’s so were coming up on thirty years in service. In order to survive they were going to need new tonnage and with the debts they had that was never going to happen. Bottom line is they were lucky to get anyone to buy them–if I was any of their competitors I would have waited until they went fully bankrupt, which was maybe two, three days after their sale.

[QUOTE=Chief Seadog;160746]The Reliance, Spirit, Consumer and Producer (currently laid up) were never US Line ships.[/QUOTE]

I stand admittedly corrected.

Different origins, but still ancient.

Just did an update on this http://gcaptain.com/sale-of-horizon-lines-hawaii-business-cleared-by-doj/

Sale announcement here http://gcaptain.com/horizon-lines-to-terminate-puerto-rico-service-announces-sale-of-remaining-company/

As it stands now, Hawaii business sale was cleared by DOJ, should closed by end of second quarter. Matson acquisition of Alaska business to follow shortly thereafter. Puerto Rico service terminated in January and all assets have since been sold off.

Right on, thanks for that Mikey!

Anyone have any idea then what’s going to happen in terms of the union contracts? Pasha uses AMO officers on their two ships. Matson only uses SIU for the steward department so a lot of SIU guys in Tacoma are worried about losing those jobs.

[QUOTE=awulfclark;160791]Right on, thanks for that Mikey!

Anyone have any idea then what’s going to happen in terms of the union contracts? Pasha uses AMO officers on their two ships. Matson only uses SIU for the steward department so a lot of SIU guys in Tacoma are worried about losing those jobs.[/QUOTE]

What are the rest of the unlicensed at Matson, MFOW and SUP?

That is correct.

Someone correct me if I’m wrong, but I believe if a company takes over another company that is under a union contract that company has to honer that contract. Now if they want to switch unions, they could exercise a buyout clause. However some unions have pretty hefty exit clauses

[QUOTE=brjones;161051]Someone correct me if I’m wrong, but I believe if a company takes over another company that is under a union contract that company has to honer that contract. Now if they want to switch unions, they could exercise a buyout clause. However some unions have pretty hefty exit clauses[/QUOTE]

Good question. Is the union contract with the operating company or with the ship? Does that even matter? What happens upon contract expiration, is the company then obligated to continue using that union or can they switch at will? Are they required to enter good-faith negotiations with the union before looking elsewhere?

In the military contract world, it happens pretty regularly that a company who uses one union will lose a contract to another company who uses another union, and that’s fundamentally what’s happening with Horizon–other companies are taking over the operations. Then there’s the issue of Interlake, when MEBA came in and took the jobs from AMO. MEBA were hammered for that, but that may have been more the way they went about gaining that contract.

Then you’ve got Maersk. I think they use AMO for some ships and MM&P/MEBA for others. Way back when they took over part of Sea Land, they kept those ships US flag and kept the same union contracts for a while, it might have been until those contracts ran out. I’m not sure if they were under any legal obligation to do so or if was just part of the agreement. I do remember it was only for a couple years and then those ships all went foreign flag.

Looks like the handover to Pasha will happen next week. Representatives from Crowley have visited some of the ships already to go over their SEMS. At the moment no change in unions, vessel names, or terminals used in LA or Oakland.

I was on the lakes when the Interlake transition happened (but not working for them). A few years later I was with Oglebay Norton when they sold some assets to ASC (and GRN). I went with one boat to ASC. Earlier that year, before the sale, the unlicensed union - Steelworkers Local 5000 - added a clause to the contract that the jobs go with the ships. More or less, anyway. It was based on seniority IIRC, so the senior guys had first pick of which company/ship they preferred. ASC used SIU on their other ships they already owned (AMO for officers). Fast forward a few years and the Steelworkers were found without jobs and replaced by scabs. Not sure if it’s still that way or they went SIU.

The short of it was that I believe SIU had a provision that new ships added to the fleet were to be crewed with SIU. ASC simply created a subsidiary to bypass the requirement. All these “legacy” clauses - jobs transfer with the ship/company - are a great idea, spoiled by the legal system in the allowance of a subsidiary to constitute a legal “the same, but technically different”.