[270117.EN.SEA] Yang Ming Recovery Plan Hinges On Government Recapitalisation

TAIWAN's troubled ocean carrier Yang Ming said it expects its government's share of the company to increase much more than the 33.3 per cent it now holds as part of a recapitalisation plan to repair it balance sheets.

Following the bankruptcy of Hanjin, Yang Ming is now the container line in the greatest financial danger, according to London's Drewry Maritime Research.

Following the Hanjin crash, which left some US$12 billion of cargo stranded on 100 containerships around the world, shippers were nervous about the financial health of ocean carriers.

On its website, Yang Ming assured investors: "Shareholders voted to approve a stock consolidation plan to pare down accumulated loss . . . and that Yang Ming would receive injection of fresh capital from new investors.

"The first stage of this injection of capital will be from various government and private entities, including banks and financial institutions. Yang Ming will issue new stock to these investors, and with the new capital, Yang Ming expects immediate benefits to its balance sheets.

"With this strong showing of government support, it is also expected to help enhance additional private sector investment in Yang Ming," its website said.

In response to Drewry's reports questioning the level of Yang Ming's debt, the company said: "Customers and vendors can rest assured that Yang Ming is not in default of any obligations and any suggestions otherwise are patently false," the carrier said.

"As it has been repeated in early advisories, Yang Ming has never approached its creditors with any demands to restructure any part of its debt, and Yang Ming does not have any intentions to do so. Yang Ming has never failed to deliver in difficult times, even in the wake of the largest carrier bankruptcy," the company said.

Source : HKSG.