As per government sources, the South Korean government could lend Hyundai Merchant Marine a helping hand if it were to bid for Hanjin Shipping’s assets.
Hanjin Shipping Co Ltd may receive a lifeline from Hyundai Merchant Marine Co Ltd. The South Korean company has disclosed that it is likely to submit a preliminary bid for the troubled shipper’s assets for its Asia-U.S. routes.
Hanjin Shipping is the first major shipper to be affected by the global shipping industry’s overcapacity and the prevailing low freight rates have not helped. It has been forced to put up its logistics systems, manpower, 5 container ships and 10 overseas business for sale last week.
Shipping sources in South Korea have however disclosed that Hyundai Merchant Marine’s potential interest in Hanjin’s assets are unclear especially those pertaining to its logistics and manpower. But, to a newcomer, the logistics systems and networks could be valuable assets to enter the shipping industry.
The valuation of these assets are yet to be determined.
As per South Korean government sources, if Hyundai Merchant Marine were to go ahead with its big, it would be favourably looked since it would expand Hyundai Merchant Marine’s market share and help normalize its business.
A spokesman for Hyundai Merchant Marine said the company has yet to make a final decision regarding its bid.
As per documents available in the South Korean court which is overseeing Hanjin Shipping’s receivership, five container ships have been put up for sale, with each having a cargo capacity of 6,500 twenty-foot equivalent units (TEUs).
Container ships of this size are typically used in West Asia routes such as those between India and other Asian destinations, according to the sources.
Sources preferred the cover of anonymity since they were not authorised to speak to the media.
Incidentally, not a single interest of Hanjin Shipping’s port terminals around the world have been put up for sale, at this juncture.
As of June 30, Hanjin, which filed for court receivership on August 31, has a total debt of $5.4 billion (6.03 trillion won).