Hanjin Shipping parent raising funds to unload stranded cargo

Tue Sep 6, 2016 6:58am EDT
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By Joyce Lee and Hyunjoo Jin

SEOUL (Reuters) - Hanjin Shipping Co's 117930.KS parent firm plans to raise 100 billion won ($90 million) to fund the unloading of billions of dollars worth of cargo aboard vessels stranded around the world in the wake of its court receivership filing last week.

Those funds may be matched by a separate 100 billion won in loans that South Korean government officials have said government-backed creditors are ready to provide if Hanjin Group, the parent firm, provides collateral. Hanjin Group is considering the offer.

The collapse of the world's seventh-largest container carrier has caused havoc in global trade networks and a surge in freight rates, as more than half 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.

Whether those funds would be sufficient to resolve cargo unloading problems was not clear. A spokeswoman for Hanjin Shipping was not immediately available for comment on the issue.

Hanjin Shipping, which many analysts and industry insiders expect eventually to be liquidated, had about 600 billion won in unpaid obligations such as charter fees and terminal use fees as of end-August. Its debt stood at 6 trillion won at the end of June and a bankruptcy would be the container shipping industry's largest.

HP Inc (HPQ.N: Quote), one of roughly 8,000 current Hanjin cargo owners, has tens of millions of dollars worth of computers and printers in more than 500 of the carrier's containers, it said on Monday in documents supporting Hanjin's U.S. bankruptcy filing.

"The ongoing disruption to HP's supply chain caused by the Foreign Debtor's bankruptcy filings is material, costly, and worsening on a daily basis," it said.

A senior official at the U.S. government's shipping watchdog has warned Hanjin, other shippers and freight forwarders against taking the opportunity to price gouge cargo customers.   Continued...

A crane carries a container from a Hanjin Shipping ship at the Hanjin container terminal as a China Shipping Line ship (L) arrives at the Busan New Port in Busan, about 420 km (261 miles) southeast of Seoul, August 8, 2013.  REUTERS/Lee Jae-Won/File Photo - RTX2O4TB