Hawaii-based ocean cargo transportation firm Matson Inc. will sail farther into the South Pacific next year, expanding its service by acquiring assets of a financially struggling New Zealand cargo carrier.
Matson announced on Wednesday that it has signed an agreement to buy the main assets of Reef Shipping for an undisclosed price.
The purchase is expected to close on Monday, at which time Matson would assume Reef’s business serving about a dozen islands mainly from New Zealand.
Assets being bought from Reef include four ships and roughly 1,500 pieces of container equipment. Two additional ships that Reef charters but does not own will also become part of Matson’s expanded South Pacific service.
The islands Matson will serve in place of Reef are Fiji, Nauru, the Solomon Islands, Tahiti, Samoa, the Cook Islands, Wallis and Futuna, Tuvalu, Niue, Tonga, Vanuatu, Tarawa and Majuro.
Reef also carries cargo from three ports in Australia, but Matson is not planning to run those routes.
Matson presently serves Guam, the Commonwealth of the Northern Mariana Islands, the Republic of Palau, the Federated States of Micronesia and the Republic of the Marshall Islands in addition to its bigger routes from the mainland to Hawaii and from China to the mainland.
Matt Cox, Matson’s president and CEO, characterized the purchase in a written statement as "relatively small" but complementary to the company’s existing service.
Matson did not disclose a purchase price or shipping volume or revenue for Reef. But the cargo capacity of the Reef ships as measured in units equivalent to 20-foot containers, or TEUs, ranges from 200 to 600 TEUs compared with 1,600 to 2,800 TEUs for Matson’s fleet of 13 ships.
"It’s a relatively small acquisition, but strategically it fits with our other Pacific island services," said Matson spokesman Jeff Hull.
"It’s a natural extension of what we’re doing."
Matson once served some of the islands to which it is expanding, but not in the past four decades. The company operated passenger and cargo ships in the South Pacific for five decades from the 1920s to 1970.
Reef has been in business for about four decades. The company is a subsidiary of Reef Group Ltd., a New Zealand-based company in a variety of industries including shipping, fishing, bottling, fueling and horticulture.
Reef Group companies were placed into receivership last month because of financial difficulties. Accounting firm PricewaterhouseCoopers is acting as receiver and has sought buyers for Reef subsidiaries as they continue operations.
