LOS ANGELES— The $300 million sale of bankrupt Hanjin Shipping's majority stake in a terminal operator at the Port of Long Beach is a credit positive for the port, according to a Moody's Investors Service report.

The lease of Pier T represented 30% of Long Beach's revenues in fiscal 2015, and liquidation of Total Terminals International would have been highly disruptive for the port, with its only recourse being to invoke the financial guaranty provided by the bankrupt shipping company, Moody's Analyst Moses Kompar wrote in the report released Monday.

The purchaser, Mediterranean Shipping Company, was the minority partner on Total Terminals International with Hanjin before it purchased Hanjin's 54% stake.

"TTI's operations were severely affected by Hanjin's bankruptcy, because TTI depended on contractually committed cargo volume from Hanjin for the majority of its business," Kompar wrote.

South Korea's Hanjin, the world's seventh largest shipping company, declared bankruptcy in Korea on Aug. 31.

Hanjin provided 650,000 of the 1.3 million containers of volume at Pier T, and revenue throughput fell by half after the bankruptcy, Kopmar wrote.

"With most trans-Pacific cargo contractually committed to other marine terminals on the West Coast, TTI was unable to secure sufficient replacement volume and defaulted on a senior bank facility debt service payment in December 2016," Kompar wrote.

The sale "is credit positive for the Port of Long Beach, because it preserves the highly valuable lease of the Pier T container terminal through 2027," Kopmar wrote. It also strengthens the corporate guaranty securing the lease by placing the underutilized Pier T with an "experienced and financially stable terminal operator."

Mediterranean is affiliated with a carrier network that controls 21% of the trans-Pacific Ocean shipping market, Kopmar wrote. Upon closing, Mediterranean will sell 20% of TTI to Hyundai Merchant Marine, a strategic partner of the shipping alliance formed by Mediterranean and Maersk, a Danish business conglomerate.

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