The South Korean shipping company Hyundai Merchant Marine (HMM) has signed a Memorandum of Understanding (MOU) to join the 2M Vessel Sharing Agreement (2M VSA) starting from April 2017, upon finalizing negotiations and approval procedures in each country.
The company signed the MOU following agreements with bond-holders to adjust debt and shipowners to adjust charter-hire.
Signed between HMM and the 2M carriers, Maersk Line and Mediterranean Shipping Company (MSC), the MOU is a binding agreement in regards to HMM’s entry to the 2M VSA.
“By accessing 2M VSA network, HMM will be able to strengthen its service offering and achieve improved cost competitiveness. The 2M carriers will benefit from a reinforced service competency in Asia and improved network cover in the trans-pacific area,” the company said.
HMM has now completed all conditions set out in the voluntary agreement with creditors from March 2016 and in accordance with the completion of such preconditions, “the planned debt-for-equity swap by creditors will be executed as planned.”
“Based on the company’s sound financial structure, HMM will put its utmost efforts into improving our service offering to clients and to continue increasing operational competency in the second half of this year to continue improving profitability of our company,” HMM’s spokesperson said.
HMM started discussions to join the world’s largest alliance 2M in June after the company reached agreements with containership owners on 20 percent charter rate cuts and with owners of bulk carriers for 25 percent charter rate reductions, which are expected to come in force over the next three and a half years.