Maui Business

Matson Completes $469 Million Alaska Operations Acquisition

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Matson Inc. ship. Courtesy photo.

By Maui Now Staff

Matson Inc. has recently completed its acquisition of Horizon Lines Inc., which includes Horizon’s Alaska operations and the assumption of all non-Hawaiʻi business liabilities, according to a PRNewswire release.

Separately and immediately preceding the completion of this transaction, Horizon sold its Hawaiʻi trade lane assets and liabilities to The Pasha Group for $141.5 million.


Matson acquired the Horizon stock for 72 cents per fully diluted common share, or $69 million, and repaid Horizon’s outstanding debt, for a total transaction value of $469 million–before transaction costs.

Matson financed the transaction with cash on-hand and the use of its revolving credit facility.

Matson will continue Horizon’s long operating history in Alaska with a three-vessel deployment of diesel powered Jones Act qualified container ships that provide two weekly trips from Tacoma, Washington, to Anchorage and Kodiak in Alaska, and a weekly sailing to Dutch Harbor, Alaska.


Matson will also operate port terminals in Anchorage, Kodiak and Dutch Harbor and acquire several reserve steam powered Jones Act container ships that may be used for dry-dock relief.

“We are pleased to have completed this strategic acquisition that substantially grows our ocean transportation business into the attractive Alaska market,” said Matt Cox, president and CEO of Matson. “The Alaska market is a natural geographic extension of our platform as a leader serving our customers in the Pacific. We are excited by the long-term prospects of the Alaska trade lane and expect this transaction to deliver shareholder value through earnings and cash flow accretion.”

Excluding the one-time transaction costs and other restructuring and integration costs, Matson expects the transaction to be accretive to annual earnings per share, providing low- to mid-teens percent annual EPS accretion in years one and two post-closing, and approximately 35 cents to 45 cents of annual EPS accretion thereafter. Within two years after closing, Matson expects the transaction to contribute approximately $70 million to consolidated annual EBITDA and to be approximately $1 accretive to annual cash flow per share.


Matson expects one-time pre-tax transaction costs and other restructuring and integration costs of approximately $45 to $50 million, of which approximately 65%, 30% and 5% are expected to be incurred in the second quarter 2015, the second half of 2015 and 2016, respectively. Matson intends to update its 2015 outlook for the effects of the transaction during its second quarter 2015 earnings conference call, currently scheduled for early August 2015.

Additional information about Matson Inc. is available online.

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