The boards of Kawasaki Kisen Kaisha, Ltd., Mitsui O.S.K. Lines Ltd. and Nippon Yusen Kabushiki Kaisha have agreed to set up a joint venture which will integrate the three container shipping businesses.
According to the companies, “K Line” and MOL will each hold 31% of the new JV, while NYK Line will hold the remaining 38%.
The JV is scheduled to be established on July 1, 2017, while services are planned to begin on April 1, 2018.
The combined company will have a fleet of 256 vessels, with a total capacity of approximately 1.4 million TEUs.
According to Alphaliner, “K” Line, MOL and NYK Line are ranked 15th, 11th and 12th in the world respectively by market share. The new JV will be ranked sixth, with a market share of about 7%.
The three lines, which are all to be in the new THE Alliance from April 2017, cited low oil prices, sluggish demand and overcapacity as the main factors behind the decision to restructure and integrate their container businesses.
The integration will bring operational efficiencies and economies of scale, which the companies hope will lead to enhanced competitiveness and profitability.
The container shipping industry has been undergoing large-scale consolidation in the past year or so, with CMA CGM acquiring NOL, COSCO merging with CSCL, and Hapag-Lloyd to merge with UASC.
