Corporate restructuring picks up pace: Hanjin Shipping unlikely to receive any fresh financing…


The government-led corporate restructuring
of Korea’s ailing shipping and shipbuilding firms is picking up a head of steam. As the government pushes some of them to downsize,…
the Hanjin Shipping appears unlikely to receive financing from its creditors. Shin Se-min has the details. Korea’s finance minister Yoo Il-ho said the
government has to stick to principle when dealing with companies in Hanjin’s situation
and go ahead with it’s corporate restructuring drive. In parliament Thursday, the finance minister
added that government can even let such companies go into court receivership because the government
can’t keep throwing tax payers money to help normalize their businesses. And more bad news for Hanjin Shipping — industry
sources say its main creditor, the state-run Korea Development Bank is unlikely to extend
more credit to the shipper without collateral from its parent group. A local court had asked for the creditors
to lend money for Hanjin’s outstanding bills, which are holding up cargo shipments worldwide. But even a 90-million U.S. dollar pledge from
the Hanjin Group chairman himself wasn’t enough to convince lenders to open their wallets
— in fact they said that’s far shy of what Hanjin needs to operate normally. Alongside the government’s corporate restructuring
drive, the Finance Ministry has laid out plans to downsize the shipbuilding industry. By 2018, the government will push to cut facilities
by 20 percent and manpower by 30 percent… at Hyundai Heavy Industries, Samsung Heavy
Industries… and Daewoo Shipbuilding and Marine Engineering. This will trim oversupply and leave the overall
size of industry at the level of two major firms based on current capacity. Finance Minister Yoo Il-ho said that it will
consistently push through the industry overhaul,… adding that the next two years will be vital
in breathing new life into the economy. Shin Se-min, Arirang News.

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