SEOUL, South Korea (AFP) — South Korea’s Hyundai Heavy Industries has received the green light for a near 3.0 billion restructuring program — including asset sales and job cuts — to keep the world’s largest shipbuilder afloat.
A spokesman for KEB Hana Bank, one of the company’s chief creditors, confirmed Wednesday that it had approved the 3.5 trillion won ($2.94 billion) plan, to be implemented over the next three years.
Hyundai Heavy, along with Daewoo Marine and Shipbuilding, and Samsung Heavy Industries, make up the “Big Three” South Korean shipbuilders who have, until recently, enjoyed a decade of almost uncontested global dominance.
But a prolonged slump in oil prices and the global economic slowdown sapped demand for tankers and container ships, while overcapacity, regional rivalry and competition from cheaper Chinese shipbuilders squeezed profit margins.
The three firms racked up a collective loss of 8.5 trillion won ($7.4 billion) last year. Daewoo Marine and Samsung Heavy have also submitted self-restructuring plans to creditors.
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