Report: Hanjin Shipping Submits New Self-Rescue Plan

South Korean container carrier Hanjin Shipping has submitted a new self-rescue plan which would see the company shed more assets, the Korea Herald said citing industry sources.

The company’s initial plan was to raise some KRW 400 billion (USD 359 million) through the sale of shares, however, the shipping firm’s creditors reportedly asked Hanjin to increase this number to around KRW 700 billion.

Although the details of the new self-rescue plan were not disclosed, the sources said that it could also include a financial boost by the company’s major stakeholders.

Earlier in August, the ailing Hanjin Shipping said that it was further hit by falling freight rates in the container shipping industry during the second quarter of 2016, as the company plunged into loss during the period.

Namely, the shipping firm reported a net loss of KRW 212 billion in the quarter, representing a significant drop from a net income of KRW 104.2 billion reported in the same quarter a year earlier.

Furthermore, the company’s half year net loss stood at KRW 473 billion, against a net income of KRW 127.1 billion seen in the first half of 2015.

After submitting a formal request in April to restructure its debt with seven lenders, led by state-run Korea Development Bank, the financially-troubled carrier received approval to move forward with its corporate rehabilitation program at the beginning of May.

The restructuring included discussions on charter rate reduction and alliance reorganization, however, the company has still not reached an agreement with 22 shipowners on charter rate cuts.

World Maritime News Staff

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