South Korea’s Ministry of Oceans and Fisheries has made plans to financially support the merger between two domestic containership operators Sinokor Merchant Marine and Heung-A Shipping.
The two companies entered into agreement in March to merge their container shipping services by next year.
The ministry revealed at a press conference that the newly established state-backed ship financing outfit Korea Ocean Business Corporation (KOBC) will provide financing support by acquiring bonds that will be issued by the merged entity. The proceeds will be used for replenishing working capital.
Additionally, the ministry will subsidise 50% of the port fees for the merged company in the first three years of operation.
Sinokor and Heung-A Shipping control around 100,000 teu in capacity and each alas has non-box related businesses, which will remain separate from the merger.