Attorneys for the South Korea based- Hanjin Shipping said the company got approval from the bankruptcy court in its home country to spend roughly $10 million to unload cargo from four ships that were headed to ports in the USA, according to an investors update from Teresa Lii, a legal analyst at Reorg Research.
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U.S. Bankruptcy Judge John K. Sherwood in Newark, New Jersey, on Friday granted Hanjin Shipping protection under Chapter 15 of the Bankruptcy Code, which shields foreign companies from lawsuits by U.S. creditors while they reorganize in another country.
The world’s seventh-largest container carrier and its clients are scrambling to move an estimated $14 billion worth of cargo off ships that are no longer operating normally in the wake of its collapse last week.
Hanjin Shipping is seeking bankruptcy protection at home and in the United States after creditors rejected its latest plan to deal with a $5.37 billion debt. Hanjin is under court receivership, and in addition to the suppliers lack of willingness to service the carrier’s vessels, these vessels also risk being arrested when they call in ports, which means that many Hanjin ships are now stranded outside of ports.
Peterson said that despite Hanjin’s bankruptcy, “TTI is current in all of its payments to us”. “The Hanjin ships are going to be off the market for the holiday seasons”. Hanjin Shipping is seeking stay orders to prevent its ships from being seized by creditors in over 40 countries.
The map below shows the locations of Hanjin’s container ships.
Container freight charges have more than doubled since May and could appreciate further, the agency said.
Hanjin Shipping’s parent company, Hanjin Group, has agreed to inject million into its troubled subsidiary. That has exporters in the USA scrambling to reroute cargo to other carriers.
Seoul wants rival Hyundai Merchant Marine to acquire Hanjin Shipping’s best assets, including ships, overseas networks and workers, said Jeong Eun-bo, vice chairman of South Korea’s Financial Services Commission.
Hanjin Shipping said on September 4 that 68 of its vessels – 61 container ships and seven bulk vessels, which carry unpacked goods such as grains – were unable to operate as port authorities worldwide have blocked them from unloading their cargo due to concerns about not being paid.
And it’s not the only tech company caught up in the Hanjin mess.
“In terms of how much cargo is impacted, the only solid number we’ve heard came from the Korean ministry that said we’re talking about 500,000 containers”, Jensen says.
During the course of researching an article examining Hanjin’s fall, most furniture vendors contacted by Furniture/Today declined comment on the situation. How long it will take the stranded vessels denied access to ports, with US shippers cargo on board, to get cleared to dock is anyones guess.
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But they added, “There may be some exposure for branded goods that the department stores purchase as they are unsure at this point which of their vendors may use Hanjin”.
