[Courtesy of Hyundai Merchant]
Shares of South Korea's troubled Hyundai Merchant Marine rose Tuesday after it said it was considering the sale of its oil-carrier business as part of a self-rescue plan to secure liquidity and jettison non-core assets.
Hyundai Merchant, the country's second-largest shipping company, has been reeling from a snowballing debt. Last year it posted 253.5 billion won (221.4 million US dollars) in operating losses amid a protracted slump in the shipping industry.
Creditors have urged the company to ride out its liquidity crisis through aggressive restructuring and sales of non-core assets. Hyundai Merchant is saddled with a total debt of about four billion dollars.
In a regulatory filing on Monday, Hyundai Merchant said it was considering the sale of its oil-carrier division, although nothing has been decided yet.
"Various ways including the sale of our oil carrier division are under consideration to secure liquidy and improve our financial structure," the company said. "As yet, nothing has been decided."
Last week creditors agreed to put Hyundai Merchant on co-management in a bid to keep it alive. The company's maturing debt and interest would be rolled over by three months. It is required to cut lease rates paid to the owners of chartered ships.
Hyundai Merchant has sold two of its three large crude tankers, divested its LNG businesses and sold stakes in other Hyundai group units including Hyundai Logistics and Hyundai Oilbank. It is in negotiations with potential buyers to sell its stake in a terminal in the southern port of Busan.
Aju News Lim Chang-won = cwlim34@ajunews.com
reporter
Park Sae-jin
swatchsjp@ajunews.com
