Financially troubled South Korean yard Daewoo Shipbuilding & Marine Engineering (DSME) is expected to secure at least KRW800bn ($692m) in cash through additional debt-for-equity swaps, sources told Korean media Yonhap News.
In March, DSME’s top lenders Korea Development Bank and the Export-Import Bank of Korea said they would provide KRW2.9trn in additional loans and swap about KRW1.6trn of debt for equity if other creditors and bondholders agreed to convert up to 80% of their debt and extend maturities for remaining loans by as much as five years.
The plan was put on hold due to an individual bondholder filed a lawsuit against the debt rescheduling program.
According to the sources, DSME is planning to start the process of swapping debts for equity with bondholders next month as the court has rejected the bondholder’s lawsuit.
By the end of June, DSME had already secured KRW2.1trn in cash through debt-for-equity swaps with bank creditors.
