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Hyundai merchant said to assess Hanjin assets for acquisition
[SEOUL] Hyundai Merchant Marine Co, controlled by state-owned Korea Development Bank (KDB), has started looking at some of the assets of troubled rival Hanjin Shipping Co for possible acquisition, according to people with direct knowledge of the matter.
South Korea's second-biggest container line has been approached by financial institutions that have funded Hanjin's vessel purchases, for a likely sale of mostly container ships, the people said, asking not to be identified, as the talks are private.
Hyundai Merchant is considering all measures to bolster its competitiveness, a spokesman said.
Representatives for Hanjin and KDB declined to comment.
More than three weeks after Hanjin Shipping sought bankruptcy protection, creditors and owners are stepping up efforts to help ease cargo disruptions resulting from boxes stuck on stranded ships.
Korea Development Bank, Hanjin's biggest lender, said Thursday it will offer a credit line of 50 billion won (S$60.95 million) if funds previously pledged by the owners are insufficient to ease the situation.
KDB said earlier this month that it would "actively support" any efforts by the liner should it decide to purchase some of Hanjin's assets, provided the acquisition helps it remain competitive.
The Financial Services Commission had also asked KDB and Hyundai Merchant to form a task force to consider the purchase of Hanjin's profitable assets. Hyundai Merchant said Sept 1 that it is open to such a move.
Hyundai Merchant, which is itself in the midst of a creditor-led restructuring program, and other global shipping lines have added new services and additional vessels to help transport cargo after many Hanjin ships were unable to unload or pick up shipment amid concerns the company doesn't have enough cash to pay for fuel and port handlers.
Hyundai Merchant is in touch with Hanjin owners as well and the assessment is at an early stage, the people said. The company is also looking at Hanjin's overseas shipping agents and sales network, people said.
KDB has no plans for any additional funding for Hanjin other than credit line offer made Thursday, a spokesman for the lender said Friday.
The 60 billion-won loan extended by Korean Air Lines Co, Hanjin's biggest shareholder, the 40 billion won provided by Chairman Cho Yang Ho and 10 billion won pledged by a former chairwoman for Hanjin Shipping should be enough to unload the cargo, a person said.
Hanjin Shipping applied for court receivership on Aug 31 after creditors rejected its revamp proposal and stopped support.