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Gov't mulls injecting 800 bln won into Hyundai Merchant for normalization

2018/10/13 14:40

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SEOUL, Oct. 13 (Yonhap) -- The government is considering an injection of 800 billion won (US$706 million) into Hyundai Merchant Marine Co., the nation's leading oceangoing shipping company, within this year to help it tide over mounting losses, industry sources said Saturday.

The company's largest-shareholder Korea Development Bank and the state-run maritime business promotion agency, Korea Ocean Business Corp. (KOBC), said they are reviewing a plan in which Hyundai Merchant issues bonds and the two purchase 400 billion won worth of the bonds each.

Hyundai Merchant and the government share the view that the firm's shipping capacity should be raised to 1 million twenty-foot equivalent units by 2020 to secure competitiveness.

Last month, the company placed 3.15 trillion won worth of container ship orders with the country's three major shipbuilders.

"We have not decided on how or to what scale the support will be made, but it will be announced soon," a KOBC official said.

KOBC was launched in July amid a protracted slump in the industry to support placing orders for new ships in the form of investment or guaranteeing the ship purchase program.

The nation's Big 3 shipyards -- Hyundai Heavy Industries Co., Daewoo Shipbuilding & Marine Engineering Co. and Samsung Heavy Industries Co. -- have been forced to undergo sweeping self-rescue programs worth 11 trillion won since 2016.

This undated photo provided by Hyundai Merchant Marine Co. shows one of its container ships. (Yonhap) This undated photo provided by Hyundai Merchant Marine Co. shows one of its container ships. (Yonhap)

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