Hamburg Süd buys Crowley's South American business
Crowley will sell its South American liner service to Hamburg Süd this fall.
By Staff -- Logistics Management, 9/1/1999
Germany's Hamburg Süd, which already operates three ocean carriers serving South America--Columbus Line, Transroll Navegacao, and Alianca Marítima--has ensured its dominance in that region by purchasing Crowley American Transport's South American liner services. The sale came as a surprise to industry observers. The two companies had announced just 10 days earlier thatthey were discussing "combining their expertise, resources, services, and operations" in the United States-South America trades, raising expectations that they would form an operating alliance that would replace Crowley's existing arrangement with APL Ltd.
The sale includes Crowley's trade lanes between the U.S. Atlantic and Gulf coasts and the East and West coasts of South America. Hamburg Süd will retain Crowley's "CAT" brand name in the trade. The German shipping company also will take over Crowley's offices and personnel in South America as well as those in the United States that were related to Crowley's South American services. The transaction is expected to be finalized Oct. 1.
Both companies had invested significant resources into developing services in South America over the last three years, but overcapacity, followed by the region's economic slowdown, has forced liner services to re-evaluate their positions in the South American market. "The sale of our South American liner services to Hamburg Süd will further strengthen Crowley Maritime Corp. and allow for future investment, service innovation, and concentration of our assets in our core service areas," said President and CEO Tom Crowley Jr. in announcing the deal. Crowley will focus on further developing its services between the United States, the Caribbean, and Central America. In fact, the day after the Hamburg Süd deal was announced, the company said it would add capacity between the U.S. Northeast, Florida, and Puerto Rico.
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