South Korea’s shipping firm Hyundai Merchant Marine has entered into a Memorandum of Understanding to sell ten of its containerships as it looks to raise fresh funds.
Namely, the company will sell the vessels to the state-backed ship financing firm Korea Shipping Co for a price of KRW 150 billion, which will then be leased back to HMM.
The shortfall compared to the book value of the ships, which is in the range of KRW 850 billion, would be financed with bond and stock sales to the financing firm.
Under the agreement, Korea Shipping is set to purchase some KRW 100 billion worth of stocks and another KRW 600 billion worth of bonds.
The move comes on the back of the prolonged shipping woes experienced during 2016, which culminated in the bankruptcy of the South Korean container carrier Hanjin Shipping in late August.
Due to a number of asset sales undertaken in 2016, Hyundai Merchant Marine managed to narrow its net loss for the full year to KRW 4.4 billion from a net loss of KRW 627 billion seen in the previous year.
World Maritime News Staff