[Courtesy of Hyundai Merchant]
South Korea's Hyundai Merchant Marine has been allowed to join a global shipping alliance, paving the way for its rehabilitation through the injection of fresh liquidity into the troubled container carrier, a key creditor bank said Thursday.
A final deal has yet to come, but the 2M of Maersk Line and Mediterranean Shipping, the world's two largest carriers, has agreed in principle to allocate a seat to Hyundai Merchant, the state-run Korea Development Bank said.
Joining a global shipping alliance has been one of the key conditions set by creditors in restructuring the debt-stricken company.
Expectations on Hyundai Merchant's rehabilitation have been high since the company forged a crucial deal last months with foreign ship owners to slash fees on chartered ships.
The restructuring program includes debt-for-equity swaps and asset sales. Hyundai Merchant saddled with a total debt of more than five trillion won (4.3 billion US dollars) at the end of March hopes to complete debt-for-equity swaps with creditors and bondholders by August.
Creditors have already endorsed a debt-for-equity swap worth 680 billion won while bondholders allowed Hyundai Merchant to reschedule a debt of 804 billion won.
A prolonged slump in global trade and overcapacity have depressed transportation rates, causing shipping lines to stem losses through job cuts and consolidation.
Aju News Lim Chang-won = cwlim34@ajunews.com
reporter
Park Sae-jin
swatchsjp@ajunews.com
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