Daewoo Shipbuilding Fights Liquidity Crunch
South Korean shipbuilder Daewoo Shipbuilding & Marine Engineering (DSME) is going all out to secure cash amid growing concerns over a possible liquidity crisis and a widening probe into accounting fraud, reports Korea Herald.
DSME, currently under a creditor-led corporate rehab, plans to submit later this week a detailed plan to secure funds to its creditors.
According to local reports, the plan may include an earlier than scheduled spinoff and initial public offering of its special-purpose ship business. DSME is also accelerating cost reductions, including job cuts.
The shipbuilder had initially agreed with creditors to separate the cash cow business by 2018.
DSME will now push to separate the division and make it public no later than late this year, they said. It will also plan to sell off a partial stake in the envisioned entity to raise more funds.
By 2018, the shipbuilder hopes to save 559 billion won ($502 million) of the cost by cutting jobs and outsourcing some work.