Alexander & Baldwin to split into separate firms

HONOLULU

Ocean transportation and logistics-services company Alexander & Baldwin Inc. said Thursday that it will split into two independently operated and publicly traded companies before the end of next year.

Management and the company's board, which unanimously approved the strategy, have been evaluating for years whether to divide the company's real estate development and logistics and transportation businesses. They concluded that each business is financially strong enough to run independently and offer the best value for shareholders, Chairman Walter Dods said.

"The strength of our combined businesses has historically served us well," Dods said. "However, we have reached the point in the growth and development of each of our businesses where they can better achieve their full potential by operating as separate companies."

Alexander & Baldwin's shares jumped 9.3 percent in aftermarket trading.

Under the terms of the separation plan, one company would be in the real estate business, with interests in land development, commercial property and agriculture. It would retain the name Alexander & Baldwin.

The second company would be called Matson and would be a logistics and ocean transportation firm serving the West Coast of the U.S., Hawaii, Guam, Micronesia and China. Alexander & Baldwin acquired Matson in 1969.

Each company will be based in Hawaii, have more than $1 billion in assets and one thousand employees.

Once the separation is completed, shareholders would own one share of each new company for each share of Alexander & Baldwin they own.

The separation is expected to be competed in the second half of next year.

Management said it expects some shift in its workforce between the two companies, but no net job loss as a result of the separation.

The company also said there will be no interruption in operations as a result of the separation.

Over the past decade, Alexander & Baldwin's commercial real estate portfolio has grown to 44 properties in Hawaii and eight mainland states.

In the same period, Matson has expanded beyond its core Hawaii and Guam services to China, where it operates an expedited service from Shanghai to Long Beach, Calif. It also has expanded its logistics business.

Stanley M. Kuriyama will be chairman and CEO of the new Alexander & Baldwin, while Christopher J. Benjamin, currently President of A&B Land Group, will be president and chief operating officer.

The company has tapped Paul K. Ito to serve as chief financial officer, controller and assistant Treasurer.

Dods will be Matson's chairman, while Matthew J. Cox, currently president of Matson, will be the company's president and CEO.

Matson's chief financial officer will be Joel M. Wine, currently Alexander & Baldwin's CFO.

Each corporation will have its own independent board of directors.

Retired Adm. Thomas B. Fargo was appointed to the board of directors for both Alexander & Baldwin and Matson.

Shares in Honolulu-based Alexander & Baldwin gained $3.55, or 9.3 percent, to $41.61 in aftermarket trading. The stock ended the regular session up 17 cents at $38.06.