Korea Development Bank is to pump another W50 billion into bankrupt Hanjin Shipping to deal with the cargo backlog in major ports around the world (US$1=W1,105).
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Lenders to the troubled Hanjin Shipping Co are considering new loans, according to a person familiar with the matter, which will give temporary relief to the troubled container carrier whose bankruptcy filing has roiled global supply chains. Chairman Cho Yang-ho and former Hanjin Shipping chair Choi Eun-young earlier contributed a combined $44.6 million from their personal wealth to pay for unloading cargo on Hanjin’s container ships. Korean Air will provide 15 billion won in subordinated loans to Hanjin Shipping on collateral for its staff residence buildings in Seoul and Busan, 10 billion won in senior loans backed by its office building in Atlanta, the United States, and 35 billion won in subordinated loans on collateral for Hanjin Shipping receivables.
Even with the help of the bank, it was not clear if the new funds would be enough to solve the cargo crisis.
A German court has allowed Hanjin Shipping’s stay of proceedings, paving the way for its ships to unload or take on containers at ports, the company said on September 23.
KDB said it attached a condition that it will have a right to collateral over Korean Air, and explained that the credit line is only meant to help the company unload stranded cargo and not as operating capital.
KDB, the main lender to Hanjin, declined to comment on the talks.
That left billions of dollars’ worth of clothing, electronics, furniture and other goods expected to fill the shelves ahead of the fall shopping season stranded offshore. “As long as the ships are not unloaded, it’s adding up the bills for Hanjin”.
The crisis also left sailors trapped for weeks on those ships.
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The nation’s maritime ministry will work with shipowners and unions to help more than 1,200 crew members on vessels Hanjin is responsible for.
