HANJIN Shipping, Korea's biggest container carrier, plans to raise KRW410 billion won (US$357 million) selling assets to improve its balance sheet in the face of financial crisis, reports Bloomberg.
Hanjin Shipping has been unprofitable for the last five years. Its cash on hand fell 56 per cent from a year earlier to KRW241 billion at the end of 2015, according to data compiled by Bloomberg.
In an almost mirror image of action taken by its smaller Korean rival Hyundai Merchant Marine, Hanjin plans to sell its bulk-shipping interests and other units as well as some property and brand rights.
It will also seek to restructure its ship financing debt and bonds sold to individual investors.
Korea Development Bank, the main creditor of Hanjin Shipping, has asked the company to submit a more detailed debt revamp plan.
Hanjin Shipping will also negotiate to cut rates on vessels it leased from shipowners, the company said. Most of the vessels that have been chartered at high rates are scheduled to be returned by 2017, it said.
This comes after Hanjin Shipping said in December 2013 that it will raise KRW2.5 trillion by selling key assets as pre-emptive measures. It got about KRW1.9 trillion from that plan, the company said.
Source : HKSG.