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Eximbank to fund purchase of containers by HMM for $30m

The Export-Import Bank of Korea headquarters in Seoul (Eximbank)
The Export-Import Bank of Korea headquarters in Seoul (Eximbank)
The Export-Import Bank of Korea said Tuesday that it would provide $30 million to fund the purchase of 34,000 twenty-foot equivalent unit containers by the nation’s top shipper, HMM Co.

The state-run lender will provide the senior debt, while Multi Asset Global Investment, an alternative investment fund operator under financial giant Mirae Asset Financial Group, will manage subordinated debt funds worth $10 million. Mirae Asset Securities, the key brokerage unit of Mirae Asset Financial Group, will participate as lead arranger.

HMM, formerly known as Hyundai Merchant Marine, will sign a five-year finance lease contract with a special-purpose company set up here. The company will lease the TEU containers to HMM for five years and the shipper can purchase the assets after that term ends.

Eximbank’s announcement comes days after HMM posted a record quarterly operating profit of roughly 1.2 trillion won ($1 billion) for the first three months of this year. The figure exceeded its annual operating profit of 980.8 billion won last year, when it returned to profit for the first time in a decade.

Because of its booming business, state-run lender the Korea Development Bank and the Ministry of Maritime Affairs and Fisheries are expecting to cash in from some 6 trillion won in policy finance funds that have funneled into HMM over the years.

“This marks the first time that a loan is extended by treating movable containers as collateral,” an Eximbank official said in a statement.

“It will help accelerate local financing tied to shipping and containers,” the official added. 

By Jung Min-kyung (mkjung@heraldcorp.com
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