The chaos wrought by Hanjin Shipping’s court receivership – container shipping’s largest ever bankruptcy – stepped up a notch today with sister company Korean Air stepping back from earlier promises to pump KRW60bn ($54.7m) in emergency money to at least get all cargoes off the shipping line’s stranded fleet.
Parent of both airline and shipping line, Hanjin Group, had earlier in the week promised KRW100bn in emergency funding for the line with KRW60bn coming from Korean Air and the remainder from the group’s owners, the Cho family. However, the board at the airline failed to reach agreement on the payment today. They will meet again tomorrow.
The cash shortfall comes also as lead creditor Korea Development Bank (KDB) has pulled back from injecting further funds into the ailing company, putting it on the brink of extinction.
The delay in rescue funding has placed Hanjin’s cargoes bound for the US at risk as the US bankruptcy court on Tuesday issued a provisional injunction for Hanjin ships calling at American ports until the line submits persuasive payment plans. The final hearing is due on Saturday in Korean time. Hanjin had previously earmarked Los Angeles as a place to unload stranded boxes.
How Hanjin’s parent, creditors and the government have handled the receivership of the line has been criticised heavily by analysts Alphaliner in a recent report. The French firm said the failure to act quickly had done irreparable damage to the Korean carrier’s reputation and any talk of a merger with Hyundai Merchant Marine (HMM), or another ‘white knight’, is now very unlikely given its financially ruinous situation.
Separately, representatives of the US Department of Commerce have met with South Korea’s oceans and fisheries vice minister Yoon Hag-bae and asked the Korean government to step in to prevent further delays in shipments to the US. Tales of supply chain chaos across the world continue to flood into Splash with discussion at our interactive forum Splash Chat throwing up many intriguing developments in what has become the shipping news story of the year.
Good Morning To Everyone: I am Very Disappointed in The Alliances, In Which Hanjin Shipping, Was Secured With, What a Bunch of Back Stabbers, & This is #1 Reason, Why McCaughrin’s, Are not connected to One, (1) Alliance Member. The Country of China, Wow, I did not see that coming, How Country of China has Mis -Treating Hanjin Shipping Official’s, In Putting Its Ships Under Arrest, Really. That is Low. McCaughrin Maritime Global – China, Does about $2B, Worth of Business Per Year, In China, and “IF”McCaughrin, Get connected with Hanjin Shipping, China, I, better see a Reversal in your attitude, Because Brian R. McCaughrin’s, Can always go Elsewhere To Do International Trade..I, already did that to Country of Saudi Arabia, and Moved My Middle East – China Operation, 990 miles, From Jeddah, Saudi Arabia, To Dubai, United Arab Emirate in 2015, Dont think, For One Second, I, wont do it again. Their Are Too Many Other Asia Countries, Screaming to get Brian R. McCaughrin, Global Business. Everyone in International Transportation, Better Treat HANJIN, Better Then You Have, “OR” You Will See Whole New Way Of Doing Business, & You All, Know Who You Are, It Will Be On The End Of The Stick, Instead of The Front of The Stick, Right Now…Cheers.