DEAN SENSUI / DSENSUI@STAR-BULLETIN
The CSX Consumer arrived at Honolulu Harbor in October, guided by a pair of tugboats. The shipping line was purchased for $300 million by Washington, D.C.-based Carlyle Group.
CSX Lines sold CSX Lines, which started West Coast-Hawaii ocean freight service in 1987 as Sea-Land Service, has been sold and will go through another name change but promises that its Hawaii service won't change.
to Carlyle Group
The private equity company
will change the shipper's
name to Horizon LinesBy Russ Lynch
rlynch@starbulletin.comCSX Corp., headquartered in Richmond, Va., said it wants to concentrate on its railroad business and has agreed sell CSX Lines for $300 million to private investment partnership Carlyle Group.
When the sale is completed, for $240 million in cash and $60 million in securities, the shipping line will be renamed Horizon Lines LLC. CSX will keep 20 percent of the company.
CSX, the biggest competition for Matson Navigation Co. in the West Coast trade that is vital to the Hawaii economy, said customers will see no change.
CSX has two sailings a week from the mainland to Hawaii, with barge service onward to the neighbor islands.
Brian Taylor, vice president and general manager of the CSX Hawaii-Guam division, was on Guam yesterday and unavailable for comment.
But his company issued a statement saying the line will continue to provide "the same quality service" to its customers after the ownership change, which is expected to happen early next year.
"Customers moving cargo between the continental United States, Alaska, Hawaii, Guam and Puerto Rico can expect uninterrupted high-quality service at competitive rates" from Horizon Lines, said Chuck Raymond, CSX Lines president and chief executive officer.
Raymond said he will continue as president and CEO at the headquarters in Charlotte, N.C., and contracts with shippers and employee unions will remain in effect.
Matson Navigation Co., the main subsidiary of Honolulu-based Alexander & Baldwin Inc. and a mainland-Hawaii freight line since Capt. William Matson made his first voyage in 1882, declined to comment on the upcoming change at CSX.
Matson has four arrivals in Honolulu from the West Coast each week and, like CSX, offers onward barge service to the other islands.
CSX began cutting up its ocean freight business in 1999, splitting it into three divisions, with Sea-Land Service changing to CSX Lines. At that time the company sold its international cargo shipping unit to Denmark's A.P. Moeller Group for $800 million.
CSX chose Carlyle out of six contenders for CSX Lines, said a spokesman who declined to name the other bidders.
Carlyle Group, the sixth-largest private equity company, plans to pay for the purchase from its Carlyle Partners III LP, a $3.9 billion fund raised in 2000.
Carlyle had more than $13.5 billion in assets under management as of June 30, including soft-drinks bottler Dr. Pepper/Seven Up Cos. and United Defense Industries, which makes artillery, missile launchers and other arms.
Bloomberg News contributed to this report.
