South Korean shipbuilder Samsung Heavy Industries (SHI) has submitted its self-rescue plan to its main creditor, the state-run Korea Development Bank (KDB), the Korea Herald reports citing a company official as saying on Tuesday.
The plan, aimed at restoring the company’s liquidity, reportedly includes up to 1,500 job cuts, selling of KRW 200 billion worth (USD 169 million) of real estate assets and disposing of stakes in Doosan Engine.
SHI’s move is in line with the three-track plan revealed by the country’s financial regulator, the Financial Services Commission, which targets restructuring of vulnerable industries which were hit by a global slowdown, such as shipping and shipbuilding.
Under the initiative, Daewoo Shipbuilding & Marine (DSME), one of the country’s big 3 shipbuilders, was required to submit layoffs and cost savings, while the other two, Hyundai Heavy Industries (HHI) and SHI were required to pursue self-rescue plans with their creditor banks.
Last week, HHI also submitted a self-rescue plan to creditors that is linked to further job cuts and asset sales worth up to USD 1 billion.
The country’s shipbuilders, badly affected by the ordering slowdown prompted by shipping and offshore industry woes, have been very busy since the beginning of the year with activities aimed at improving their liquidity and slashing losses accrued over the past years.
These include Hanjin Heavy Industries & Construction Co. (HHIC) which has signed a Memorandum of Understanding (MoU) on business normalization plan with its creditors, led also by KDB.
World Maritime News Staff