Bloomberg News

Nippon Yusen, Mitsui OSK Fall as Moody’s Reviews Credit Ratings

November 30, 2011

Nov. 30 (Bloomberg) -- Nippon Yusen KK and Mitsui O.S.K. Lines Ltd., Japan’s two biggest shipping lines, fell in Tokyo trading after Moody’s Investors Service Inc. said it may downgrade the companies’ credit ratings.

Nippon Yusen dropped 4.5 percent to 169 yen, the biggest decline since Sept. 20. Mitsui O.S.K. declined 3.6 percent. Third-ranked Kawasaki Kisen Kaisha Ltd. tumbled 5.8 percent.

Moody’s placed Nippon Yusen and Mitsui O.S.K.’s ratings on review because of concerns that an “increasingly weak operating market” and overcapacity in the global fleet may hamper the Tokyo-based shipping lines’ efforts to pare debt ratios. Mitsui O.S.K. is rated A3 at Moody’s. That’s the fourth-lowest investment level and one higher than Nippon Yusen’s Baa1 grade.

“Although Moody’s expects some recovery in the second half of the year ending March, the speed of improvement in leverage is likely to be slow, given the weakness in the global economy and shipping market,” Moody’s said in separate statements today about the reviews. It didn’t say how long the review may take.

The three Japanese shipping lines all jumped more than 10 percent in the previous three trading days on speculation that a global economic recovery may help revive rates for carrying commodities, containers and oil.

Editors: Neil Denslow, Young-sam Cho

To contact the reporter on this story: Kiyotaka Matsuda in Tokyo at kmatsuda@bloomberg.net

To contact the editor responsible for this story: Neil Denslow at ndenslow@bloomberg.net.


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