South Korea’s Daewoo Shipbuilding & Marine Engineering (DSME) will soon receive a cash injection from its creditors as the company’s remaining investors approved the latest debt rescheduling proposal, Yonhap News Agency said.
Namely, the investors, which hold some KRW 1.3 trillion worth of DSME bonds, gave their approval for the proposal devised by the shipbuilder’s main creditors Korea Development Bank (KDB) and Export-Import Bank of Korea (KEXIM).
The approval was granted after the main debt holder of DSME with some 30 percent of its corporate bonds, South Korea’s National Pension Service (NPS), gave its nod to the ailing shipbuilder’s latest debt restructuring plan on April 17.
The new measures, which are expected to keep the financially troubled shipbuilder afloat, would see half of the shipyard’s commercial papers converted into equity with the rest being rolled over. KDB and KEXIM will in exchange provide the company with KRW 2.9 trillion of fresh funds.
Revealed in late March 2017, the creditors’ restructuring plan sets out three key principles – debt restructuring should come first, financial assistance should follow later, and all stakeholders should bear the burden of losses.
World Maritime News Staff