Samsung Heavy ordered to produce restructuring plan

Samsung Heavy ordered to produce restructuring plan

Creditors of South Korea’s Samsung Heavy Industries have ordered the shipyard to produce a self-restructuring plan, reports say.

The state-run Korea Development Bank, Samsung Heavy’s main creditor, told Yonhap the shipyard is expected to announce restructuring and cost-cutting measures “soon”.

Last week, Samsung Heavy received another huge blow to its dwindling orderbook when Royal Dutch Shell reportedly cancelled plans for three FLNG units worth a combined $4.6bn.

As newbuilding activity falters, South Korea’s Financial Services Commission has been pressuring the country’s shipyards ramp up self-restructuring efforts, make redundancies and sell off non-core assets.

Creditors of Daewoo Shipbuilding & Marine Engineering (DSME) and Hyundai Heavy Industries (HHI) are pressing the shipyards to undertake further action to restructure their ailing businesses.

Meanwhile, state-run lenders Korea Development Bank (KDB) and the Export-Import Bank of Korea (Korea Eximbank) are reportedly running the risk of collapse if they do not receive a cash injection from the government to help them finance the restructuring of some of the country’s debt-ridden carriers and shipyards.

The two banks are financing the restructuring of Hanjin Shipping, Hyundai Merchant Marine (HMM) and DSME, among other companies.

 

Holly Birkett

Holly is Splash's Online Editor and correspondent for the UK and Mediterranean. She has been a maritime journalist since 2010, and has written for and edited several trade publications. She is currently studying for membership of the Institute of Chartered Shipbrokers. In 2013, Holly won the Seahorse Club's Social Media Journalist of the Year award. She is currently based in London.

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