Cosco Shipping is in an agreement with Singapore’s Pacific International Lines (PIL) for an exchange of 12 ships on a time charter basis.
Cosco Shipping will lease one 6,500 TEU box ship and five 4,250 TEU containerships from PIL and charter six 5,500 TEU containerships to PIL. The period of charter is between 7 to 10 months. The deal is said to be worth approximately USD 18.8 million.
Cosco stated that the ships it will charter from PIL will enable the company to deal with issues that arise due to lack of suitable internal shipping capacity of particular types of ships required for new routes to Africa, India, the US and New Zealand. In turn, by leasing out its vessels to PIL, they will be properly deployed.
The Teo family that runs PIL has developed close ties with Cosco over time.
This news comes at a time when rumours were rife about PIL being next in Cosco’s aggressive merger drive.