Zim is seeking ways to improve its debt structure in view of the ongoing slump in the shipping industry and the company's heavy debt
Zim Integrated Shipping Services Ltd. has decided to approach Goldman Sachs in order to seek ways to improve its debt structure in view of the ongoing slump in the shipping industry and the company's heavy debt.
Zim Integrated Shipping Services Ltd. and other global shipping companies have been hit hard by the global economic downturn and a financial meltdown.
Weak global demand and a capacity glut are sinking shipping rates and many container-shipping companies are cutting routes and capacity to stem a sudden flow of red ink.Zim Integrated Shipping Services Ltd. wants Goldman Sachs to advise it on its debt structure.
Several weeks ago Zim reported to the Tel Aviv Stock Exchange that it had approached various shipyards about canceling or deferring newbuild deliveries.
With several vessels laid up at the present time, and demand weakening, this was a prudent move and it is being duplicated by most shipping companies. Unfortunately, the move was a little too late to save the short-term markets.
Sources in Israel noted last week that Zim's overall financial commitments at the end of 2008 totaled some $2.0 billion.
The company embarked upon a massive expansion plan a few years ago to double its carrying capacity. The plan included the purchase of 22 container ships and other equipment at a cost of $3.1 billion, with the goal of putting the company back among the world's top ten shipping companies.