Report: Ailing Shipbuilder DSME to Get USD 2.4 Bn from Creditors

Creditors of the financially troubled Daewoo Shipbuilding & Marine Engineering (DSME) plan to financially support this South Korean shipbuilder with KRW 2.8 trillion (USD 2.4 billion), under proviso that the company’s labor union accepts the restructuring scheme, local media reported. 

DSME’s creditors, the Korea Development Bank (KDB) and the Export-Import Bank of Korea, have introduced the restructuring plan to prevent the shipbuilder’s delisting from the stock market.

Under the plan, KDB intends to convert KRW 1.8 trillion of debt into equity. The bank has already converted around KRW 400 billion worth of loans into DSME’s stocks.

The second creditor, the Export-Import Bank of Korea, plans to buy KRW 1 trillion worth of bonds that will be sold by the shipbuilding company.

However, the creditors said they will implement the restructuring scheme, which includes a workforce reduction, only if the labor union refrains from taking industrial action.

The labor union is now required to accept the scheme until Wednesday next week, Yonhap News Agency cited industry sources as saying.

Last week, DSME said it intends to raise an additional KRW 700 billion through asset sales in 2016, as the shipbuilder expects to add up to five times less orders to its order book this year than initially projected.

With the new measure, DSME would raise a total of KRW 6 trillion through its self-rescue plan.

Earlier this year, DSME revealed it will slash its workforce by 12,000 to 30,000 by 2019 as part of its cost-cutting measures.

World Maritime News Staff

Share this article

Follow World Maritime News

Posted on November 11, 2016 with tags .

In Depth>

Events>

<< Jun 2019 >>
MTWTFSS
27 28 29 30 31 1 2
3 4 5 6 7 8 9
10 11 12 13 14 15 16
17 18 19 20 21 22 23
24 25 26 27 28 29 30

The Smart Ship Exchange

The Exchange will look at the issues involved with increasing autonomy in shipping with an introduction to the concept…

read more >

Electric & Hybrid Marine World Expo Conference 2019

Electric & Hybrid Marine World Expo Conference is the world’s only international conference…

read more >

GreenTech in Shipping USA Forum 2019

GreenTech in Shipping USA Forum is an event for Maritime leaders who want to unlock successful business formula of the industry!

read more >

Global Sustainable Shipping Forum 2019

The event will provide valuable insights from conference sessions, great networking opportunities and will offer…

read more >