New box line TCC begins raising capital.
The world"s newest shipping line, The Containership Company (TCC), will offer up to 15 million shares in a private placement that is expected to raise more than US$50 million in working capital. PR News Service reports that funds raised will be spent on starting costs and equipment for TCC"s initial two strings that will be launched in April and May ? China-North Europe and China-US West Coast.
Subscription to the share offering will give investors an ownership in TCC of 93 percent. The subscription period began yesterday and ends on February 18.
With 500-plus container ships in lay up and vessel charter costs at an all time low level, TCC believes the market is ready for its low cost, no frills model.
The carrier"s approach is based on: A simple operational setup; port-to-port operation with no feeder costs; a lean organization; and low cost terminal handling at a port outside Shanghai and closer to manufacturing facilities.
In a report, the company said ?lower break-even cost than peers set the stage for a significant upside when rates recover to levels required by peers to break even?.
TCC expects revenue from its two services to begin flowing in from late May or June.
On the China-US East Coast trade, TCC will launch its Great Dragon Service that will deploy six vessels of between 2,500 and 3,250 TEU capacity.
This service will start in April and cover the Shanghai-Los Angeles route with a direct call in Taicang International terminal just outside Shanghai.
Taicang International Gateway port is a joint venture between the Jiangsu provincial government and Hong Kong"s Modern Terminals.
It was selected over Yangshan Deepwater Port or Waigaoqiao in Shanghai because of its proximity to the manufacturing centre of the Yangtze River Delta.
On the China-North Europe trade, TCC will launch the Western Dragon Service with 10-11 vessels ranging between 3,500 and 4,250 TEUs.
This service will begin in May, and again utilise the Taicang International terminal, calling at Rotterdam and Hamburg in North Europe.
PR News Service reports that TCC"s future business concept also includes services around South Africa covering the Asia and Europe trades
To back up these plans, TCC has put in place third party agency and systems agreements with Norton Lilly, which interestingly also represents Wan Hai and Pacific International Lines (PIL), which also have plans to relaunch their own Asia-Europe service around the same time as TCC and with identical capacity.
Norton Lilly"s role will include equipment control, booking and customer service, accounting, export and import documentation as well as terminal operations and claims handling.