Authorities in the Philippines are determined to give Hanjin Heavy Industries and Construction Philippines (HHIC-Phil) every chance of surviving, with an initial eight-year rehabilitation plan under discussion.
The subsidiary of the Korean shipbuilder was granted a court rehabilitation by a court in the Philippines earlier this week, weighed down by debts believed to be in excess of $1bn.
The deputy governor of the country’s central bank, Diwa Guinigundo, has said the giant yard, the largest shipbuilding site in Southeast Asia, has been given an eight-year window to get back on its feet, starting with a three-year grace period in order to turn around its operations.
“Based on the initial information that we got, it will take eight years — three years grace and five years to repay the obligations. To the extent that you have a market and the facility continues to operate, then the issue of cash flow will be addressed,” Guinigundo said yesterday.
As well as discussions to nationalise the yard and reports two Chinese entities are keen to take over HHIC-Phil, the nation’s defence secretary has revealed authorities are in discussions with companies from the US, Japan, South Korea and Australia to buy the Subic Bay-based shipbuilder, which has 12 ship contracts on its books when it sought court protection.