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All Hanjin Shipping chartered vessels to be returned to owners after unloading: judge

Published 09/19/2016, 02:32 AM
© Reuters. A Hanjin Shipping Co ship is seen stranded outside the Port of Long Beach
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By Joyce Lee

SEOUL (Reuters) - All Hanjin Shipping Co Ltd (KS:117930) chartered vessels that have completed unloading their cargo have been told to cancel their charter agreements and return the ships to the shipowners, a South Korean judge said on Monday.

Hanjin, the world's seventh-largest container line, filed for receivership last month, leaving more than 100 ships and their cargo at sea and threatening to snarl U.S. freight traffic as the year-end shopping season approaches.

Dozens of Hanjin's ships have been blocked from docking with ports and lashing firms fearing they won't be paid. Some vessels have also been seized and some sold.

The company had a total of 141 vessels, including 97 container ships as of early September. Out of the 97 container ships, 60 were chartered and 37 owned by Hanjin.

The company returned three bulk carriers earlier this month, a Hanjin Shipping spokeswoman said on Monday.

In addition, four container ships have been returned to the shipowners as of Sunday, while Hanjin has received shipowners' notifications to return 13 more container ships, another Hanjin spokeswoman said.

Current delays in unloading cargo are incurring more than $2 million in charter fees daily, the judge in charge of liaising with media at Seoul Central District Court also told Reuters in a text message.

Last week, Hanjin secured $45 million from its chairman and a former chairwoman to help unload an estimated $14 billion in cargo trapped on its ships but needs more money to pay port and trucking fees.

Korean Air Lines Co Ltd (KS:003490), the top shareholder of Hanjin Shipping, has been considering lending the shipper 60 billion won ($53.70 million) but the plan has run into resistance.

Korean Air's board of directors met on Sunday to discuss the deal, including alternatives to Hanjin Shipping's Long Beach Terminal stake being provided as collateral, but did not reach a conclusion, a Korean Air spokesman said on Monday.

Banks led by state-run Korea Development Bank (KDB) withdrew backing for Hanjin late last month, saying a funding plan by its parent group was inadequate to tackle debt that stood at 6.1 trillion won as of end-June.

South Korea has said no government or central bank money would be directly injected into the firms restructuring in the ailing shipping and shipbuilding industries, though it is helping small-to-medium sized businesses hit by the restructuring.

© Reuters. A Hanjin Shipping Co ship is seen stranded outside the Port of Long Beach

($1 = 1,117.4000 won)

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