SM Group's shipping institutional sector affiliate Korea Line Corporation(005880) said on the 2nd that it signed a long-term charter contract for pure car and truck carriers (PCTC) with Hyundai Glovis(086280).
The contract is worth a little over 73 billion won, equivalent to 5.7% of Korea Line Corporation's revenue on a consolidation basis last year. The term is 5 years and 4 months starting in Nov.
With this deal, the number of PCTCs that Korea Line Corporation will charter long term to Hyundai Glovis increased to two. Korea Line Corporation plans to purchase one secondhand PCTC and charter it out.
Under the charter, Korea Line Corporation will handle ship and crew management exclusively. Hyundai Glovis will be responsible only for operations.
Korea Line Corporation said the ship management capability and trust it has shown while maintaining PCTC contracts with Hyundai Glovis since 2015 were the background to winning this order.
Korea Line Corporation plans to build growth momentum with additional orders by responding to rising demand for PCTCs and dedicated liquefied natural gas (LNG) carriers.
Min Sang-gi, CEO of Korea Line Corporation, said, "While responding nimbly to changes in trends and uncertainties in the global shipping market, we will also discover new businesses that meet stability and profitability at the same time and continue strategic investments for future growth and to enhance shareholder value."