HMM Names Jae-hoon Bae As New CEO
South Korean container line Hyundai Merchant Marine (HMM) has announced that its board of directors had approved the hiring of Jae-hoon Bae as president and chief executive officer (CEO).The CEO recommendation committee led by Korea Development Bank, selected Bae as the final candidate for the next HMM CEO following a comprehensive candidate examination.Before his formal appointment, Bae came to the office to meet HMM’s senior executives and thoroughly checked current and future business conditions for the company.HMM official said in a press statement…
Hyundai Merchant Marine to Say Good Bye to 2M Alliance?
South Korea's largest shipping firm Hyundai Merchant Marine (HMM) is likely to part ways with the 2M Alliance which will expire in April 2020 and join a new ocean alliance said a local media report.According to a report in Business Korea, the 2M Alliance (consists of Maersk Line and MSC) is disadvantageous to HMM as it is not a full member of the alliance. HMM's status fell as the 2M Alliance inked a partnership deal with Israel's Zim Integrated Shipping Services, the report…
South Korea Restuctures Mid-Sized Shipbuilders
The South Korean government decided to restructure two financially-troubled mid-sized shipbuilders, said a report in Business Korea. While filing for court receivership for the debt-ridden Sungdong Shipbuilding, the government has decided to save STX Offshore and Shipbuilding Co. on condition of slashing 75 percent of its production workforce. The two shipbuilders are heavily indebted to Korea's two state-run banks, as they have struggled with snowballing losses amid unfavorable oil prices and the worldwide industry downturn.
STX Corp to Be Sold to Chinese Firm
AFC Korea, a subsidiary of Chinese private equity fund AFC, has been selected as the preferred bidder for cash-strapped STX Corp, according to a Business Korea report. AFC Korea has reportedly offered a price tag above 70 billion won (US$65.62 billion) for an 86.28 percent stake owned by STX creditors. STX creditors include Korea Development Bank (KDB), which holds a 39.59 percent stake, and NongHyup, which has 10.07 percent. AFC beat three other potential bidders including Pan Ocean, which was once a part of STX, and textile manufacturer Global SAE-A.
Former Chief of Daewoo Shipbuilding Gets 6 Years in Jail
Former Daewoo Shipbuilding & Marine Engineering (DSME) boss Nam Sang-tae sentenced to six years in prison by Korean court for embezzlement and bribery, Yonhap reported. The report said that the Seoul Central District Court handed down the guilty verdict to Nam Sang-tae, 67, convicting him of accounting fraud, embezzlement, breach of duty and bribery. The court ordered him to forfeit 880 million won (US$806,000). Prosecutors have demanded an eight-year prison term. The court said…
Hyundai Merchant Marine Seeks USD 8.9 bln from KDB
Hyundai Merchant Marine (HMM) requested the Korea Development Bank (KDB) to support with a total of 9.9 trillion won (US$8.9 billion) in funds until 2022 to grow into the 8th largest global shipping company in the future, Business Korea reported. HMM had asked consulting firm AT Kearney to estimate how much support funds for HMM would be needed. AT Kearney calculated that a total of 9.9 trillion won will be needed, including 5.6 trillion won (US$5.0 billion) for large container ships…
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.
Korea Bank Puts 10 Hanjin Vessels Up for Sale
Korea Development Bank, the main creditor of the dissolved Hanjin Shipping Co. and state-owned entity, has put 10 Hanjin vessels up for sale in order to source back elements of its extended loans, reports Yonhap. According to the sources, potential buyers are required to submit their bids for the ships — two container ships and eight bulk carriers — by Feb. 21. Previously a South Korean court agreed to formally end Hanjin Shipping Co Ltd’s court receivership process after a two week appeal period, ending the business.
South Korean Court to Liquidate Hanjin Shipping
The Seoul Central District Court Thursday decided to end the bankruptcy protection of Hanjin Shipping Co. Ltd (Hanjin Shipping), leaving the company to succumb to a declaration of bankruptcy later this month, Yonhap reported. Hanjin, once the world's seventh- or eighth-largest container shipper, filed for court receivership in late August 2016 as its creditors, led by the state-run Korea Development Bank (KDB), said they would not provide additional financial support to Hanjin starting from September 4.
Hyundai Merchant Marine Ties Up with 2M Alliance
Heavily indebted South Korean shipper Hyundai Merchant Marine Co Ltd (HMM) said on Sunday it has agreed with the 2M shipping alliance to form a cooperative relationship that falls short of full-fledged membership. Joining an alliance with major shipping firms was one of the conditions of a debt restructuring deal between Hyundai Merchant Marine and its creditors in May, and the company said on Sunday that the tie-up with 2M met that criteria. Its main creditor, the state-backed Korea Development Bank…
Happy Holidays from Hanjin
Barry Parker dissects one the most disruptive events ever to impact the intermodal supply chain. There is more pain to come, lessons to be learned – and corrections applied. The Hanjin Shipping debacle, brewing over time and seeing a full blown eruption in late August, is still ongoing. The company voluntarily opted to enter ‘receivership,’ followed by a Chapter 15 bankruptcy filing in the States, shortly after the initial bombshell. The move provided a template for Hanjin vessels to dock, and cargo to be discharged.
What next for THE Alliance? - Drewry
Hanjin’s bankruptcy leaves the proposed carrier grouping THE Alliance at a size disadvantage to both its future rivals. Might a replacement be called up? The container shipping industry is in a state of flux at the moment and nobody can honestly say they know for certain what the landscape will look like in six months from now. Even before Hanjin Shipping filed for bankruptcy protection the industry was preparing itself for big changes to the make-up of the major shipping alliances, which from April next year are scheduled to downsize from four to three.
Hanjin Shipping to Submit Self-Rescue Plan
South Korea’s Hanjin Shipping is planning on submitting a self-rescue plan to creditors this week to stave off bankruptcy by Aug. 25, reports Korea Herald quoting local media. According to the shipper, the plan includes details on securing funds from its parent Hanjin Group and cutting charter fees from foreign vessel owners. According to Pulse, Hanjin Group is expected have stronger units like Korean Air help out their troubled affiliate Hanjin Shipping through new share purchase and negotiate for cut in charter fees to up to 28 percent to normalize the country’s largest cargo carrier.
Is Hanjin Shipping Going Into Court Receivership?
According to a latest report in Korea Times, South Korea's biggest container carrier Hanjin Shipping's efforts to settle the rescheduling deadlines for financing ships and reducing charter fees before the end of July has not yet be resolved. This situation is raising concerns over the possibility that the nation's top shipping line may go into court receivership. Or, Hanjin may get a month's extension from creditor banks of an August 4 deadline of a voluntary restructuring agreement…
Creditors May Give Breathing Room for Hanjin Shipping
State-run Korea Development Bank and other creditors are expected to extend their conditional debt rescheduling program for Hanjin Shipping Co. to stay afloat, reports Korea Herald. This move will give the struggling shipping company enough time to cover liquidity shortage on its own. The ailing company still needs to raise about 1 trillion won ($875 million) to keep afloat. According to sources, KDB may extend the initial Aug. 4 deadline by a month until early September. It is likely for the main creditor bank to vote for allowing more time for the shipper’s preparation…
HMM May Hire Foreign CEO for Revival
Hyundai Merchant Marine (HMM) will start the process to appoint a new chief executive officer (CEO) when Hyundai Group loses control on Aug. 5, reports Korea Times quoting un-named industry sources. The challenged shipper will begin a new chapter in its 40-year history, breaking free from Hyundai Group and becoming a subsidiary of Korea Development Bank (KDB). KDB is bent on installing a new leadership at the shipping line and is open to hiring a foreign chief executive. To make a pool of candidates, the creditor reportedly appointed a number of executive search firms.
Hanjin Sells Vietnamese Terminal
South Korea's largest shipping line Hanjin Shipping has sold its entire 21.3% stake in Tan Cang Cai Mep International Terminal (TCIT) in Vietnam to its affiliate in order to secure liquidity. The financially-troubled shipping line will raise about $33m from the sale. The move came after the government and creditors, led by state-run Korea Development Bank, pushed Cho Yang-ho, the chairman of Hanjin Group, to pour more cash to the ailing shipping arm of the company. TCIT is a joint venture company of Saigon Newport Corporation with Hanjin, Mitsui OSK Lines and Wan Hai as partners.
Maersk May Swallow Hyundai Merchant
Business Korea reports that rumours are now rife in the container business world that Maersk could swoop on Hyundai Merchant Marine and subsume its activities into their own business. Even though it is still a prediction, if the prediction becomes a reality, it is highly likely that the sell-off of Hyundai Merchant Marine will receive strong backlash with a mounting criticism that the government sold a major national flag carrier for a giveaway price. According to the shipping industry and creditors…
The Odd Trio: HMM, Maersk and MSC
In one of the more bizarre twists in the container shipping market it emerged last week that financially troubled carrier South Korean Hyundai Merchant Marine (HMM) is in talks with the world’s two largest lines, Maersk Line and MSC about the possibility of joining them in the 2M alliance. This is a significant shift in mood music from HMM, which until recently was in danger of being a container pariah, locked out of the new alliance structures for next year after years of heavy losses, says Drewry Research.
HMM in Talks to Join 2M Alliance
Maersk and MSC have initiated meetings with Hyundai Merchant Marine (HMM) to discuss the South Korean carrier joining the 2M alliance, says local media reports. According to Korea Herald, Korea’s second-largest shipping company is considering joining the 2M Alliance, a vessel-sharing agreement between Denmark’s Maersk Line and Switzerland’s Mediterranean Shipping Company - the world’s first and second largest container carriers. Amid growing speculation that HMM is set to join the alliance, a HMM official confirmed that discussions are ongoing with the alliance parties on June 23.
THE Alliance Beckons HMM
Hyundai Merchant Marine (HMM) is sailing into the THE Alliance. With the new charter deals it is now “one step closer to becoming a member of THE Alliance”, from which it was excluded when the mega-alliance was announced last month. According to a report in Business Korea, HMM president Lee Baek-hoon met with K Line president and CEO Eizo Murakami in Tokyo to discuss the former’s joining the THE Alliance. At the meeting, K Line mentioned that it would approve of Hyundai Merchant Marine’s membership in the THE Alliance sooner or later.
STX Shipbuilding Struggles to Survive
STX Offshore & Shipbuilding may be put under a court-led restructuring scheme, paving the way for the shipyard to avert liquidation, says a report in Korea Times quoting local court. Last month, STX Shipbuilding, once Korea's No. 4 shipbuilder, filed for receivership to stay afloat as its creditors decided to end a similar rehabilitation program for the shipbuilder. The shipbuilder is required to submit its self-rescue plan to the Seoul Central District Court by Sept. “It is regrettable…
Seoul's Effort to Calm Shipping Sector Storm
South Korea will pump $9.5bn (11 trillion won) into state-run policy lenders reeling from huge losses on loans made to the beleaguered shipbuilding and shipping sectors to help them deal with further corporate distress, says FT. South Korea's fund will support two state-run banks most exposed to shipping and shipbuilding firms currently being restructured. The China slowdown is partly to blame. The two state-run banks to be capitalised are Korea Development Bank (KDB) and the Export-Import Bank of Korea (KEXIM).
Korean Shipbuilder Could Be Liquidated
South Korea's STX Offshore & Shipbuilding Co. has filed for receivership, following massive losses that have mounted up over the past two years, says a report in the WSJ. According to multiple sources from the shipbuilding industry, creditors and STX Offshore & Shipbuilding have decided to put Goseong Offshore & Shipbuilding under court management early next month and have begun taking necessary steps. The decision has been made after judging that it would be difficult for the…
STX Shipbuilding Likely to Enter Court-lead Restructuring
South Korean shipbuilder STX Offshore & Shipbuilding Co Ltd will likely need to enter court-supervised receivership due to financial difficulties, the firm's lead creditor Korea Development Bank said on Wednesday. STX Offshore's creditors took control of the company in 2013 after the shipbuilder was hit by falling ship prices following the global financial crisis. A Korea Development Bank spokesman said the firm's creditors will decide on how to proceed with the court receivership process by the end of the month…
DSME Reveals Additional Self-Restructuring Plan
South Korean shipbuilder Daewoo Shipbuilding and Marine Engineering (DSME) has revealed an additional self-restructuring plan amid the falling shipbuilding orders. The company’s creditors, led by the state-run Korea Development Bank, will now decide on the new self-rescue plan which proposes a further cut in DSME’s workforce and wages, as well as temporary closure of docks, the Korea Herald reports citing industry sources. The company plans to separate its lucrative defense business, including special vessel, put it in its subsidiary and list it.