Report: CMA CGM forfeits vessel payment

Report: CMA CGM forfeits vessel payment    Debt-addled French liner carrier CMA CGM has reportedly forfeited a $60 million advance payment on a 6,500-TEU vessel it ordered in 2006 from a Korean shipyard.
   The report emerged Friday in European trade press outlets, after the ship was apparently sold to a Greek ship owner rather than the French line, which has attempted to cancel an order of four such ships with Hanjin Heavy Industries, the South Korean shipbuilder.
   CMA CGM has been trying to restructure its debts with lenders after its ambitious fleet expansion program ran headlong into the demand downturn for containerized goods. The line has been in talks with Korean shipyards from which it ordered vessels to delay or cancel a number of vessels.
   In December, founder and chairman Jacques Saad' said the line would take delivery of the biggest vessels it has ordered, but is trying to defer or cancel delivery of smaller ships.
   The four 6,500-TEU ships were to be delivered in the second half of 2009.

Saad'

   The significance of last week's development is that CMA CGM could potentially lose the $60 million it made as an advance payment for the vessel. Lloyd's List reported that Hanjin is taking a harsh stance on the advance payment to send a message to CMA CGM that it should honor the terms of the contract it signed. If the line is unwilling or unable to take delivery of the other three vessels, and the shipyard refuses to back down, the loss could conceivably reach $240 million.
   The line said it couldn't comment on the ongoing discussions with the shipyard, when contacted by American Shipper.
   'CMA CGM is aware of the continued discussion in the media concerning this issue,' the line said. 'The company continues in its discussions with Hanjin Heavy Industries and other parties with regard to these vessels. Our efforts are focused in this direction, and please understand that while these discussions are ongoing it would be inappropriate to comment further.'
   According to the maritime news outlet Tradewinds, Hanjin Heavy Industries on Thursday announced to the stock exchange in Seoul the sale of the ship to a new buyer. The price it fetched was reported to be in the $40 million to $45 million range, a relative steal for the unnamed buyer since the ships were valued at $100 million apiece at the time of order. The shipyard, if it manages to retain the advance payment from CMA CGM, would basically be getting what it expected for the ship.