Horizon Lines, a domestic shipping line with its Puget Sound base of operations at the Port of Tacoma, will be acquired by Hawaii-based Matson, Inc., the two companies announced Tuesday.
The acquisition could become the first test of the strength of the new operating alliance between the ports of Tacoma and Seattle if Matson decides to consolidate all of its operations in the Pacific Northwest in a single Puget Sound port.
Matson ships sail three times weekly from the Port of Seattle’s Terminal 18 to Hawaii. Horizon vessels connect the Port of Tacoma with Alaska twice weekly.
Neither Horizon nor Matson was able to speak Tuesday about the future shape of its Puget Sound operations. The two shipping lines are concentrating for now on preparing for the acquisition and performing due diligence investigations, company representatives said.
Another open question presented by the sale arrangements revealed Tuesday is the fate of Horizon’s once weekly connection between sailing between the Port of Tacoma’s APM Terminal and Hawaii.
Horizon said it intends to sell its Hawaii business to the California-based Pasha Group Inc. before it finalizes the deal with Matson. A spokeswoman for Pasha said it was too early for Pasha to say whether that service will continue to call at the Port of Tacoma after the sale.
Pasha is acquiring Horizon’s Hawaii business and four of Horizon’s ships for $141.5 million. Pasha already links San Diego with a single roll-on, roll-off ship, the M/V Jean Anne. It has contracted with a Gulf shipyard to build another vessel for that trade, the M/V Marjorie C.
At the same time Horizon and Matson were announcing their deal, Horizon also announced it is ending its service to Puerto Rico from the East Coast. That route has been unprofitable for the Charlotte, North Carolina-based Horizon for several years.
The news of the impending halt to Horizon’s Puerto Rico service could be good news for another Puget Sound based company, Saltchuk Resources Inc. Saltchuk’s Sea Star Lines is one of Horizon’s main competitors in providing service between the mainland United States and Puerto Rico. Privately held Saltchuk also owns Totem Ocean Trailer Express, Horizon’s principal rival in the Alaska trade. Tote’s Puget Sound base of operations is in Tacoma.
Matson, Pasha and TOTE are all so-called Jones Act shipping companies. That act requires that goods shipped by sea between U.S. states or territories be carried only in vessels built in the U.S. and crewed by U.S. workers.
The deal between Matson and Horizon is expected to close in 2015.
If Matson decides to call at only one port in the Puget Sound, a newly-formed operating alliance between the rival ports of Seattle and Tacoma will have to decide whether to actively market only a single port to the combined company or whether to simply lay out each port’s advantages and remain neutral in the decision-making.