DSME Deal Non-starter
The creditors of Daewoo Shipbuilding & Marine Engineering (DSME) still remain undecided over afor the shipyard's latest deal, further complicating troubles for one of the country's major shipyards, Yonhap reported. DSME clinched a US$250 million deal to build three very large crude carriers (VLCCs) on April 4. Under the deal with Maran Tankers Management, a unit of Greece's largest shipper Angelicoussis Shipping Group, Daewoo Shipbuilding will deliver the 318,000-ton VLCCs by 2018.
Daewoo Shipbuilding unlocks $2.6 bln Bailout
Bondholders at final meetings agree to debt-to-equity swap; shipbuilder needs about $400 mln in operating funds by April-end. South Korea's Daewoo Shipbuilding & Marine Engineering Co Ltd has won near unanimous agreement from bondholders to swap their debt for equity, meeting a condition that unlocks a $2.6 billion bank bailout for the world's biggest shipbuilder. Daewoo won approval from over 96 percent of bondholders at two meetings on Tuesday and three on Monday, with attendance exceeding 78 percent.
Daewoo Shipbuilding Bondholders Okay Bailout Plan
Debt-to-equity swap plan is condition of $2.6 bln bailout. South Korea's Daewoo Shipbuilding & Marine Engineering Co Ltd on Monday won near unanimous approval for a debt-to-equity swap plan in the first three of five bondholder meetings, as the world's largest shipbuilder battles to stay afloat. The votes were held hours after Daewoo's biggest bondholder, the National Pension Service (NPS), said it had agreed to the proposal. That move made it likely other bondholders would follow suit, creditor bank officials said, allowing the shipbuilder to meet conditions of a $2.6 billion bank bailout.
Daewoo Shipbuilding to Get Fresh $2.6 Bln Bailout
South Korean state banks are preparing a fresh $2.6 billion bailout for floundering Daewoo Shipbuilding & Marine Engineering Co Ltd, which has built up huge losses from offshore projects and risks missing debt repayments. Daewoo, Hyundai Heavy Industries and Samsung Heavy Industries are South Korea's top shipbuilders - a massive economic force and a source of national pride. But they slipped into the red in 2015 amid a commodities downturn and bleak trade volumes, prompting cost cuts and asset sales. Of the three, Daewoo's situation is the most difficult.
Korea Shipping to Buy Up to 10 HMM Vessels
The state-backed ship financing company Korea Shipping is looking to buy up to ten container vessels operated by Hyundai Merchant Marine (HMM), and lease them back to the shipping firm, says a report in Yonhap. “Korea Shipping will provide some 720 billion won (USD 633.7 million) to Hyundai Merchant this month or next month to shore up its capital base,” the report quoted Sohn Byung-doo, a standing member of the Financial Services Commission, the country’s financial regulator, as saying. Funds will be transferred to HMM through the purchase of stocks and debts.
FSC Denies Mergers Between Big Three Shipbuilders
The chairman of South Korea's Financial Services Commission, Yim Jong-Yong, reiterated that Daewoo Shipbuilding and Marine Engineering (DSME) would not be merged with Samsung Heavy Industries (SHI) and Hyundai Heavy Industries (HHI), according to a report in Korea Times. The Big Three companies are all under restructuring and a potential 'big deal' will harm all of them, said Yim. A precondition for a big deal is all of those companies undergo restructuring thoroughly and stand on their own. However, they are not in such a condition, he added.
Ex-chairwoman of Hanjin Under Scrutiny
The former chairwoman of bankrupt Hanjin Shipping Choi Eun Young is under investigation for alleged insider trading BBC reports qoting South Korea's Financial Supervisory Service. She has come under scrutiny after it was revealed she sold all her shares in the firm days before it filed for a debt restructuring programme in April. Ms Choi and her two daughters sold shares worth 3bn won ($2.7m, £2.1m) in April. She left the company in 2014. The sell-off saved Ms Choi and family around S$1.35 million as Hanjin continued to sink amidst the global downturn in trade…
Hanjin Shipping Secures $45 mln to Rescue Stranded Cargo
Parent group transfers $36 mln to troubled shipper. It may cost over $150 mln to unload stranded cargo. The chairman of Hanjin Group transferred 40 billion won ($36 million) to Hanjin Shipping on Tuesday to help unload cargo stranded on the troubled shipper's vessels, a spokesman said, but regulators warned securing further funds could take "considerable time". The parent of Hanjin Shipping pledged last week to raise 100 billion won to help rescue cargo in the wake of the collapse of the world's seventh-biggest container shipper, including the 40 billion won from Chairman Cho Yang-ho.
Hyundai Eyes Samsung, LG Cargo
South Korea’s second-largest container line Hyundai Merchant Marine Co Ltd is in talks with South Korean firms such as home appliance makers Samsung and LG to carry their cargo, Reuters reported quoting the chairman of South Korea's Financial Services Commission. Hanjin Shipping Co Ltd was handling cargo of Samsung Electronics Co Ltd and LG Electronics. Hyundai plans to deploy 13 more vessels to the U.S. and Europe to help ease cargo disruptions after its bigger rival Hanjin's collapse, according to a report in Bloomberg.
Hanjin Sends SoS
As most of Hanjin Shipping Co's assets are stranded at sea or in ports world-wide, the the South Korean company is seeking to protect assets world-wide. Hanjin Shipping’s government-backed creditors are ready to provide the collapsed carrier with roughly 100 billion won ($90.60 million) of loans if Hanjin’s parent provides collateral, Fortune reports South Korean government officials as saying. Hanjin's collapse has left much of its fleet stranded at sea, unable to dock over fears that vessels be seized by creditors.
More Collapses, M&A Will Follow Hanjin, Warns Flitch
Korean Hanjin Shipping's filing for receivership reflects an unsustainable supply-demand imbalance in container shipping, Fitch Ratings says. "We expect more defaults and M&A activity in the short and medium term but these will only restore equilibrium and boost freight rates if they prompt capacity reduction," says Fitch. Bankruptcies in shipping are not unusual, especially in the current dire industry conditions, but Hanjin is the seventh largest container shipping company in the world and its filing for receivership may therefore have far-reaching ramifications.
Hyundai Merchant Marine to buy Hanjin's 'Good' Assets
South Korea's financial regulator said on Wednesday that Hyundai Merchant Marine Co Ltd will seek to acquire healthy assets of troubled shipper Hanjin Shipping Co Ltd. The Financial Services Commission said in a statement that Hanjin will soon file for court receivership but that the impact from the filing on domestic financial markets will be limited. A Hyundai Merchant Marines spokesman told Reuters nothing has been decided on any potential acquisition of Hanjin assets and that the firm will be in talks with Hanjin lead creditor Korea Development Bank concerning future plans. Reporting by Joyce Lee and Changho Lee
Hanjin files for Receivership, Ports Turn Away Vessels
Hanjin says asks court for its assets to be frozen; Hyundai Merchant looking to buy Hanjin's "good" assets. South Korea's Hanjin Shipping Co Ltd filed for court receivership on Wednesday after losing the support of its banks, setting the stage for its assets to be frozen as ports from China to Spain denied access to its vessels. Banks led by state-run Korea Development Bank (KDB) withdrew backing for the world's seventh-largest container carrier on Tuesday, saying a funding plan by its parent group was inadequate to tackle debt that stood at 5.6 trillion won ($5 billion) at the end of 2015.
HMM-Hanjin Marriage on Anvil
The Korean government has said that it will consider merging ailing Hyundai Merchant Marine (HMM) and Hanjin Shipping should they successfully normalize their management, according to The Korea Times. "Once the normalization program for the two shipping companies is wrapped up, the government will consider various plans including the merger of the companies," said Financial Services Commission (FSC) Chairman Yim Jong-yong. He said, “The possibility of the merger is not so different from the direction of our restructuring plans for shipping companies revealed earlier.
Creditors Putting Pressure on Samsung Heavy
The restructuring issue of Samsung Heavy Industries (SHI) will spread to the entire Samsung Group as its main creditor Korea Development Bank(KDB) and the financial authorities are putting pressure on the group, reports Business Korea. SHI has submitted its self-rescue plan to its main creditor, the state-run KDB, the Korea Herald reports citing a company official as saying on Tuesday. The plan, aimed at restoring the company’s liquidity, reportedly includes up to 1,500 job cuts, selling of KRW 200 billion worth (USD 169 million) of real estate assets and disposing of stakes in Doosan Engine.
Hanjin Shipping, Hyundai Merchant Merger Talks in Air
A report in WSJ says that Hanjin Shipping Co has applied for a creditor-led debt restructuring to avoid bankruptcy, reviving talk of a possible merger with rival Hyundai Merchant Marine Co. (HMM). It could be merged as a part of the government-led restructuring of ailing industries and companies, according to government sources. Both Hanjin Shipping Co. and Hyundai Merchant Marine Co. (HMM) are in hot water, but they are different from each other in a debt structure. Unlike HMM…
Korea to Create $1.2bln Shipping Fund
The South Korean government will create a US$1.2 billion ship investment fund to aid the shipping industry which has been struggling due to decreasing global trade. A report by South Korea's Yonhap News Agency said the fund will help shippers buy and sell vessels with less financial risk. The fund, aims to "aid the shipping industry which has been struggling due to decreasing global trade". Fund will "help shippers buy and sell vessels with less financial risk as the Korea Trade Insurance Corp. and the Korea Maritime Guarantee Insurance Co.
KAMCO Becomes White Knight for Shipping
Acquiring ships from financially troubled shipping companies will remain one of the mainstay jobs handled by South Korean finance house Korea Asset Management Corporation (KAMCO) next year, reports Korea Times. The company has bought 33.3 billion won worth of assets from two SMEs in the January-October period and plans to acquire assets valued at 40 billion won from two to three SMEs by December, a move to give relief to financially troubled companies, KAMCO Chairman Hong said in a press conference on Dec.
Hanjin-Hyundai: No Merger or Only Restructuring?
South Korea’s government is discussing whether to merge or sell Hanjin Shipping and Hyundai Merchant Marine in an attempt at state-led industrial restructuring. But the two lines in question belong to different container alliances, are fierce rivals and have both denied that Seoul is trying to coerce them to merge. “There is a need to maintain the existence of the two companies when considering the impact a merger could have on South Korea’s import- and export-oriented economy and global shipping alliances…
South Korea Takes Stab at Slaying Zombie Company Menace
South Korea is getting serious about tackling its "zombie company" problem and will set up its first restructuring firm backed by the government and banks in November, spooked by some huge corporate losses and a darkening economic outlook. Korea Development Bank (KDB) will also seek to sell some of the 118 non-financial firms it controls, the government said last week - a move seen as part of its new resolve to deal with the issue. About 20 companies controlled by the state-run bank are seen as struggling.
Korea Mulls Shipbuilding Finance Back-up Plan
An official at the Financial Services Commission (FSC), South Korea's financial regulator, is quoted by Xinhua as stating that the government plans to order a feasibility study by research institutes on the feasibility of setting up a shipping guarantee fund, with the report due for consideration in the first half of next year. Similar types of funds for shippers have already been established in some European countries such as Germany and Denmark, the official indicated, noting that the funds would serve as a guarantor for loans to shipping companies.
Korean Shipbuilders Get Break from Accounting Rules
According to a July 30 report from the JoongAng Daily, with the scheduled adoption of the International Financial Reporting Standards (IFRS) shipbuilders were expected to see higher debt ratios. However, the Financial Services Commission and Financial Supervisory Service said that the International Accounting Standards Board (ISAB), the London-based group that supervises the IFRS, had accepted in principle a request by Korean financial authorities to allow a fair value hedge accounting system in the case of the shipbuilders. A fair value hedge system would allow shipbuilders to declare an intermediate payment in their financial accounts for contracts they received. (Source: JoongAng Daily)