SOS from Hanjin Shipping
The creditors' extended help is crucial for survival of Hanjin Shipping Co as its negotiations with owners of chartered ships over a cut in leasing rates and to postpone debt repayments to foreign creditors made significant progress, says the cash-strapped firm.
Yonhap reports the shipper as saying that the shipping industry is very important for the national economy, adding "the government and the creditors' help is desperate."
Creditors of Hanjin Shipping, led by the state-run Korea Development Bank, have threatened to put the shipper under receivership, saying its fresh self-rescue plan is far shy of demands.
Local banks' credit exposure to Hanjin is estimated at 1.02 trillion won (US$915 million), but they have already set aside sufficient provisions against the loans.
The state-run Korea Development Bank (KDB), KEB-Hana Bank and other banks extended a total of 1.02 trillion won to the country's No. 1 shipper, says Yonhap quoting un-named sources.
Hanjin Shipping needs some 1.3 trillion won over the next 18 months to pay back debt and run its business. The company, however, has claimed that some 400 billion won will be enough if it succeeds in cutting charter rates and postponing debt repayments.
Meanwhile, local media reports that KDB and other creditors of debt-ridden company on Friday hinted that the country’s largest container carrier would fall under court control after the shipper has failed to come up with sufficient liquidity plan to cover its debts.
