In International Shipping News 19/07/2016
Source: BusinessKorea
Hyundai Merchant Marine held an extraordinary shareholders’ meeting on July 15 and decided to implement a capital reduction without refund. Following a debt-equity swap scheduled for next week, creditors are to become the largest shareholder in the company on July 25 and the company is to leave the Hyundai Group for the first time in 40 years.
After the capital reduction at a ratio of 7:1, the current largest shareholders’ shares – 6,066,273 owned by Hyundai Elevator, 613,563 owned by Hyundai Global and 571,428 owned by chairman Hyun Jeong-eun – are reduced to 1,035,893 shares. The capital reduction becomes effective on August 19 and the listing of the shares is scheduled for September 1.
On July 14, Hyundai Merchant Marine met all the three requirements for a voluntary agreement, that is, debt restructuring in relation to debenture holders, charter rate adjustment and the acquisition of a membership in the 2M alliance, by signing a memorandum of understanding with the shipping conference.
Hyundai Merchant Marine’s financial structure is likely to show a significant improvement from July 25 after the completion of the debt-equity swap. Specifically, its debt ratio is expected to dip below 400% and the company is predicted to be able to place orders for large container carriers by satisfying the criteria for benefiting from the South Korean government’s ship fund. In addition, postponement of loan repayment and loan rate adjustment are expected to help the company stabilize its cash flow.
Source: BusinessKorea
