Horizon Lines
| Company type | Public |
|---|---|
| Industry | Ocean shipping and logistics |
| Predecessor | Sea-Land Service, Inc. (domestic liner division) |
| Founded | 1956 |
| Defunct | 2015 |
| Fate | Acquired by Matson Navigation Company; operations ceased |
| Successor | Matson Navigation Company, The Pasha Group (for Hawaii routes) |
| Headquarters | Charlotte, North Carolina , United States |
Area served | Continental United States, Alaska, Hawaii, Puerto Rico |
| Products | Container shipping, logistics services, vehicle and household item transportation |
Horizon Lines, Inc. was a U.S.-based ocean shipping and logistics firm headquartered in Charlotte, North Carolina. It held the position as the largest maritime shipping company fully compliant with the Jones Act, managing roughly 37% of container traffic between the continental United States and destinations such as Alaska, Hawaii, and Puerto Rico. The Jones Act mandates that vessels transporting cargo between U.S. ports must be constructed, owned, and flagged in the United States and crewed predominantly by American citizens. Horizon Lines originated from Sea-Land Service, Inc.'s domestic liner division, which was divested in 2003 and rebranded as Horizon Lines. The company went public on the New York Stock Exchange in 2005 before being acquired by Matson Navigation Company in 2015.
Scope of operations
By 2014, Horizon operated a fleet consisting of 13 Jones Act-compliant container ships alongside approximately 31,000 cargo containers, maintaining cargo terminals across Alaska, Hawaii, and Puerto Rico. The company conducted about 150 port visits annually at Tacoma, Washington, facilitating routes to Alaska and Hawaii. Up until November 2011, Horizon also provided trans-Pacific shipping services to Guam and China. Terminal operations were managed through contracts at seven ports within the continental United States. Horizon’s clientele primarily comprised companies dealing in consumer and industrial goods as well as U.S. government entities like the Department of Defense and the U.S. Postal Service. Additionally, the company offered transportation services for vehicles and household items.
Concerns among investors centered on the advanced age of some vessels; while typical container ships are retired after around 28 years of service, Horizon continued to operate older steam-powered C6 and C7 Lancer Class vessels such as the SS Horizon Discovery (formerly American Liberty), originally built in 1968 for the now-defunct United States Lines.
Department of Justice controversy and litigation
In May 2011, the U.S. Department of Justice reduced Horizon Lines’ penalty for price-fixing activities in the Puerto Rico market from $45 million down to $15 million. This reduction was influenced by concerns from bondholders and bankruptcy risks following the loss of a contract with Maersk Line.
In October 2011, Horizon secured a $653 million refinancing arrangement to avert bankruptcy. Nevertheless, on October 20, trading of its shares on the New York Stock Exchange was suspended due to its market capitalization falling beneath the $15 million minimum requirement. Thereafter, Horizon’s stock was traded on the OTCQB market.
By November 2011, Horizon reached a settlement totaling $13.75 million with shippers who had opted out of a Puerto Rico antitrust class action lawsuit. On January 28, 2012, Horizon pleaded guilty to falsifying oil record-keeping documents related to its U.S. West Coast-Hawaii operations. The company paid a $1 million fine and contributed $500,000 to the National Fish & Wildlife Foundation. Additionally, it agreed to undergo three years of probation and implement an environmental compliance program.
Company sale and close of operations
In November 2014, Horizon Lines announced plans to divest its entire business portfolio. Its Alaska routes were purchased by Matson, Inc. for $469 million; following regulatory clearance, its Hawaii trade-lane operations were sold to The Pasha Group. Service to Puerto Rico ceased in December 2014 due to persistent financial losses and difficulties maintaining its aging steam-powered fleet. Previous cost-reduction measures had already scaled back Puerto Rico services prior to this decision. The final transaction was completed on May 29, 2015, officially marking the conclusion of Horizon Lines’ operational activities.
External links
- Articles with short description
- Former United States shipping firms
- North Carolina-based companies no longer operating
- Transportation firms founded in 1956
- American businesses closed in 2015
- 1956 North Carolina establishments
- 2015 North Carolina closures
- Anchorage, Alaska economic sector
- American enterprises founded in 1956
- Companies previously traded on the New York Stock Exchange
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- Companies of the United States by year of establishment
- American companies established in 1956