TS Lines Limited announced the early termination of its Master Container Lease Agreement with TEH Shipping Lines Co., Ltd. effective 1 May 2026, and concurrently entered into a three-year Container Management Services Agreement through its wholly owned subsidiary, TS Container Lines Pte. Ltd. (TS Singapore).
The lease agreement, originally scheduled to run until 31 December 2026, enabled TEH Shipping to utilise the Group’s excess containers. Under a deed executed on 29 April 2026, both parties agreed to cease the arrangement without any termination fee or other compensation. The Board stated that ending the lease will not have a material adverse impact on the Group’s operations or financial condition.
To replace the income stream from leasing, TS Singapore will provide container management services for 2,300 20-foot standard containers and 2,700 40-foot high-cube containers owned by TEH Shipping. Management fees are set at US$5.75 per TEU per month, calculated monthly based on the actual number of TEH containers managed.
Expected maximum management fee income: • FY 2026 (eight months): US$0.35 million (approximately HK$2.76 million). • FY 2027: US$0.53 million (approximately HK$4.14 million). • FY 2028: US$0.53 million (approximately HK$4.14 million).
Pricing was determined on normal commercial terms, referencing maintenance costs, insurance, and software licence fees. The Board, including independent non-executive directors, considers the agreement fair, reasonable, and in shareholders’ interests.
Regulatory context • TEH Shipping is 88.4% controlled by the Chen family, TS Lines’ controlling shareholders, making it a connected person under Hong Kong Listing Rules. • The termination deed requires disclosure under Rule 14A.35. • All percentage ratios (other than the profits ratio) for the container management agreement are below 0.1%, qualifying the transactions as de minimis and fully exempt from reporting, annual review, announcement, and independent shareholders’ approval requirements.
Directors Mr. Chen Teh-Sheng, Mr. Chen Shao-Hsiang, and Mrs. Chen Chuang Chuang-Li abstained from voting on the resolutions related to both the termination and the new service agreement.