Horizon Lines to sell off and close Jones Act enterprises

In a move that may alter the balance of U.S.-flag shipping, Matson, Inc. announced that it is acquiring the stocks of rival carrier, Horizon, and its Alaska operations. Meanwhile, Pasha – a privately-held logistics provider based in the San Francisco Bay Area – will acquire Horizon’s Hawaii operations.

In a related development, Horizon stated that it will cease operations and shut down its Puerto Rico domestic liner service.

“The acquisition of Horizon’s Alaska operations is a rare opportunity to substantially grow our Jones Act business,” said Matt Cox, President and Chief Executive Officer of Matson. “Horizon’s Alaska business represents a natural geographic extension of our platform as a leader serving our customers in the Pacific.”

Cox added that he was encouraged by the long-term prospects of the Alaska market – which mirrors Hawaii in many operational ways –despite having different underlying economic drivers.

Industry analysts note that both markets are “captive,” with supply chains reliant upon timely container cargo service within very narrow trade lanes.

At the same time, however, this development – pending regulatory approval –  may represent fewer options for shippers, and a further weakening of Jones Act competition.