HMM denies 2M partnership failure

Hyundai Merchant Marine on Sunday denied a news report that it failed to join the 2M Alliance that the company has sought for months as part of its normalization plan.

The Journal of Commerce reported Friday that the 2M Alliance would not include HMM based on a confirmation statement which the biweekly magazine claimed to have obtained from Maersk Line.

The JOC said HMM would instead collaborate with Maersk Line and Mediterranean Shipping Company through a slot purchase agreement which would allow Maersk to take over Hyundai’s chartered vessels and slots, particularly in trans-Pacific trade.

The Korean shipping company, however, denied the report, saying that Maersk had confirmed the news report was not true.

“Maersk Line apologized (to us for the misinformed news) and pledged to request a correction from the JOC,” said HMM officials. “(The company) is still in negotiations over details of the membership process with the 2M Alliance. The official membership contract will likely be wrapped up no later than early next month.”

Since May, HMM has sought to join the 2M Alliance, the world’s largest alliance for shipping companies, in which Maersk and MSC are the members.

This was part of the conditions requested by the firm’s creditors earlier this year to normalize its business. The Korea Development Bank and other creditors promised debt-to equity swap if the shipper meets all the conditions. This included changing the charter cost, rescheduling the debt rate and joining the 2M Alliance from April next year.

In July, Hyundai said it had signed a memorandum of understanding with the 2M Alliance for joint operation and that it had completed all the conditions that the alliance requested.

The Korean shipper has persistently expressed willingness to join the group. HMM Vice President Kim Chung-hyeon recently said the company would wrap up the 2M membership process by this month.

Amid the worsening shipping industry, global shippers around the world have strived to join alliances to reduce charter fees.

The near-bankrupt Hanjin Shipping succeeded in joining an alliance called THE Alliance before it filed for court receivership.

By Lee Hyun-jeong (rene@heraldcorp.com)