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Creditors of cash-strapped Hanjin Shipping Co. plan to decide whether to put the country's No.1 shipper under receivership by Tuesday, as a new self-rescue scheme falls short of expectations, its main creditor said Friday.
On Thursday, Hanjin Shipping, under growing pressure from its creditors to secure more money to tide over a deepening cash shortage, submitted a stronger self-rescue plan. The new scheme includes sales of more assets and a capital infusion by its major shareholders.
But the creditors led by state-run Korea Development Bank (KDB) said the fresh self-restructuring measure is just shy of their demand.
"There are no differences between the previous self-rescue plan and the new one," said KDB.
According to KDB, Hanjin Shipping said it would secure 400 billion won ($359 million) by selling stocks to its affiliate Korea Air Lines Co., but the stock sale would wrap up by July next year.
Also, the shipper proposed raising another 100 billion won by selling assets, according to the policy lender.
Hanjin Shipping initially proposed raising some 400 billion won via stock sales to its affiliates, but creditors wanted the shipping firm to jack up the figure to some 700 billion won.
Hanjin Shipping needs some 1.3 trillion won over the next 18 months to pay back debt and run its business. The company, however, has claimed that some 400 billion won would be enough if it succeeds in cutting charter rates and postponing debt repayments.
But the creditors have asked the shipper to do more to ensure its survival.
Hanjin Shipping, currently under a creditor-led restructuring scheme, has made little progress in its negotiations with owners of its chartered fleet to cut leasing rates, one of the key prerequisites set out by creditors to avert receivership.
The shipping line is also seeking to postpone the repayment of 2.5 trillion won borrowed to buy container ships and other vessels by up to three years, which would help the shipper save billions of won.
As of end-2015, the company's total debt reached 5.6 trillion won.
In 2015, Hanjin Shipping posted a net profit of 3 billion won, a turnaround from a net 423 billion won loss the previous year. (Yonhap)
On Thursday, Hanjin Shipping, under growing pressure from its creditors to secure more money to tide over a deepening cash shortage, submitted a stronger self-rescue plan. The new scheme includes sales of more assets and a capital infusion by its major shareholders.
But the creditors led by state-run Korea Development Bank (KDB) said the fresh self-restructuring measure is just shy of their demand.
"There are no differences between the previous self-rescue plan and the new one," said KDB.
According to KDB, Hanjin Shipping said it would secure 400 billion won ($359 million) by selling stocks to its affiliate Korea Air Lines Co., but the stock sale would wrap up by July next year.
Also, the shipper proposed raising another 100 billion won by selling assets, according to the policy lender.
Hanjin Shipping initially proposed raising some 400 billion won via stock sales to its affiliates, but creditors wanted the shipping firm to jack up the figure to some 700 billion won.
Hanjin Shipping needs some 1.3 trillion won over the next 18 months to pay back debt and run its business. The company, however, has claimed that some 400 billion won would be enough if it succeeds in cutting charter rates and postponing debt repayments.
But the creditors have asked the shipper to do more to ensure its survival.
Hanjin Shipping, currently under a creditor-led restructuring scheme, has made little progress in its negotiations with owners of its chartered fleet to cut leasing rates, one of the key prerequisites set out by creditors to avert receivership.
The shipping line is also seeking to postpone the repayment of 2.5 trillion won borrowed to buy container ships and other vessels by up to three years, which would help the shipper save billions of won.
As of end-2015, the company's total debt reached 5.6 trillion won.
In 2015, Hanjin Shipping posted a net profit of 3 billion won, a turnaround from a net 423 billion won loss the previous year. (Yonhap)
