Sungdong Shipbuilding & Marine Engineering, once one of the top 10 largest shipbuilders in the world a decade ago, is on the verge of declaring bankruptcy, having failed to find any investors at a third auction held this week. The yard has been in court receivership for the past 15 months.
Located in Tongyeong in the southeast of South Korea, a Sungdong bankruptcy would add to the severe unemployment in the city after a number of other yards have folded in recent years.
“After takeover bids faltered for the third time, there’s a high possibility that the court will start taking steps for Sungdong’s bankruptcy and liquidation,” Kim Hyun, an analyst at Meritz Investment & Securities told local newswire Yonhap today. “Its creditors also reportedly decided not to give financial support.”
The state has already pumped around $2.3bn to try and keep Sungdong afloat. The yard started out as an equipment manufacturer before becoming a block builder and then entered shipbuilding 15 years ago.
I am saddened at the gradual decline of shipbuilding in Tongyeong where I spent 2005 through 2009 at 21 Century Shipbuilding and Samho Shipbuilding with a series of chemical tankers. I returned in 2011 – 2012 to Shina Shipbuilding and was grieved to see 21C and Samho had already closed down. Shipbuilding transformed the Marina area of the city with new, quality apartment blocks build for the yards workers and management. A lot of very good, capable young guys turning out good quality vessels.
Tongyeong itself is a beautiful city, with a fine center of shops and restaurants, fish market, Marina, Opera House, a full-size replica of a “Turtle Boat” and a cable car to the summit of Mount Mireuksan, where the 360-degree view, is to literally die for. Very sorry at the situation the city and my many old friends now find themselves in.
Noel, you and me both brother — a fine place brought to its knees by forces beyond its control