Mitsui O.S.K. Containers Sink Into Sea as Ship Splits

(Company corrects reference to direction of towing in eighth paragraph of story originally published June 28.)

Mitsui O.S.K. Lines Ltd. (9104), the world’s largest merchant ship operator, said about 1,700 containers sank into the sea with the back half of a vessel that broke into two amid a storm in the Indian Ocean last week.

The containers had consumer goods and other merchandise inside, Akika Hamakawa, a spokeswoman at the Tokyo-based company, said by phone today. There were a total of 4,382 boxes on the ship, she said, declining to give more details about the cargo or customers, citing confidentiality agreements.

Mitsui O.S.K. said some of the containers were floating around the area and about 1,500 metric tons of fuel oil is estimated to be in the tanks of the part that sunk, according to a statement from the company yesterday. The shipping operator is working with shipbuilder Mitsubishi Heavy Industries Ltd. (7011) to find out what caused the MOL Comfort’s hull to crack and will reinforce the hulls of six other similar vessels, it said.

“This could gradually start having an impact on demand for Mitsui O.S.K.’s ships,” said Mitsushige Akino, who oversees the equivalent of about $500 million in assets in Tokyo at Ichiyoshi Investment Management Co. “It raises questions about maintenance.”

Mitsui O.S.K. rose 1.8 percent to 387 yen as of the 3 p.m. close of trading in Tokyo. The Nikkei 225 Stock Average (NKY) gained 3.5 percent.

The ship, which was also carrying letters among its cargo, was sailing to Jeddah, Saudi Arabia, from Singapore when it encountered trouble last week, according to the ship operator.

China, Japan

Prior to Singapore, the vessel went to Vietnam, according to ship-tracking data compiled by Bloomberg. Before that it sailed to China and Japan.

“We are towing the fore part in a west-northwest direction,” the company said in the statement. “We are keeping patrol boats to monitor the situation of oil leakage and floating containers in the area where the aft part sank.”

The ship, which was built five years ago, was carrying a crew of 26, comprising one Ukrainian, 11 Russians and 14 Filipinos, who were all rescued. The vessel is insured by Japan Ship Owners’ Mutual Protection and Indemnity Association, according to its website.

In 2006, a Mitsui O.S.K. vessel carrying 4,700 Mazda Motor Corp. (7261) cars was damaged in rough seas and took on water. Mazda decided to junk the vehicles after a two-month assessment to determine whether any could be salvaged, the Hiroshima, Japan-based company said at the time.

To contact the reporters on this story: Chris Cooper in Tokyo at ccooper1@bloomberg.net

To contact the editors responsible for this story: Anand Krishnamoorthy at anandk@bloomberg.net

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