Danaos hasn’t agreed to Zim charter rate cuts

Danaos hasn’t agreed to Zim charter rate cuts    Greek ship owner Danaos Corp. said Tuesday it has not agreed to a deal with Zim, the financially troubled Israeli ocean carrier, to reduce charter rates on the six containerships Zim is leasing.
   'Zim Integrated Shipping Services Ltd. has stated that it is reducing, unilaterally, all of its long-term charter hire payments to ship owners by 35 percent commencing Sept. 1, 2009 and for an indicated period of three years,' said a Danaos press release. 'Danaos has not accepted this offer, nor acquiesced to this reduction, and it is in discussions with Zim and evaluating the situation. The vessels that Danaos charters to Zim are currently operating under 12-year time charters. Zim is not a charterer of any of Danaos’ newbuilding containerships.'
   The charter reductions are part of a complex package of measures aimed at restoring stability at Zim, which is leaking money due to poor ocean freight rates and financial obligations related to its fleet expansion plans.
   Zim's parent company, Israel Corp., said earlier this month it had reached agreement with a half-dozen ship owners to lower charter rates in exchange for promissory notes ahead of a planned initial public offering in 2016. The notes would then be converted to equity shares in the company. Israel Corp. estimated a charter rate savings of $150 million. It projects Zim to have a cash shortfall of $1 billion by 2013.
   In a note to Israel’s stock exchange, Israel Corp. indicated the financial restructuring plan was not assured and that it relied on shareholder approval as well as participation from all concerned parties, including the ship owners from which it chartered vessels.