The decision by a court in Seoul whether or not to approve STX Offshore & Shipbuilding’s rehabilitation plan has been delayed. The court was meant to give its verdict on Friday, but has now said it needs more time and there will be no news on the matter until November 11.
The court is understood to be pushing management at the yard, once the world’s fourth largest shipbuilder, to slash its salary overheads by as much as 50%. The local labour union has warned it will call a strike among STX workers if salaries are slashed.
The shipbuilder sought court protection in May. It had been under creditor-led restructuring since April 2013. It was formerly part of STX Group, which went bankrupt causing a huge sell off of subsidiaries, including shipping line Pan Ocean, and most recently STX Dalian, the group’s huge Chinese yard.
STX Offshore & Shipbuilding was known as Ssangyong Heavy Industries before it was bought out by STX founder, Kang Duk-soo. Kang was sentenced for six years in jail in 2014 for fraud, a ruling that was overturned the following year.
Creditors have pumped in more than $3bn into the yard in the past couple of years, but it is still losing money.
