STX Heavy Industries told to repay its Chinese unit’s debts

By Korea Herald
  • Published : Jan 23, 2014 - 20:09
  • Updated : Jan 23, 2014 - 20:09
STX Heavy Industries Co., a troubled South Korean shipbuilder, said Thursday it would seek countermeasures to an order by China’s arbitration commission to repay 60.9 billion won ($56.8 million) in debts held by its unit.

The shipbuilder issued a loan guarantee in October 2010 on a loan by its Chinese heavy machinery maker, STX Dalian Heavy Industries Co., from China’s Bank of Communications.

Last August, the Chinese bank filed a petition with the China International Economic and Trade Arbitration Commission for repayment from STX Heavy Industries after the Chinese unit failed to service the principle and interest.

The South Korean shipbuilder said it was notified by the commission Wednesday to pay back the loans.

“We will take active countermeasures (against the Chinese bank’s petition) according to the arbitration procedure,” the company said in a regulatory filing.(Yonhap News)