Financially troubled South Korean shipbuilder STX Offshore & Shipbuilding will be placed under court receivership by creditors following it failure to reach a deal with its labour union on proposed self-rescue plans, reports Yonhap News.
Creditors led by the state-run Korea Development Bank (KDB) earlier said that they can issue refund guarantees for new ships and keep the company afloat if the shipyard and its union could agree on a package of self-help programs that includes a 75% cut in jobs at the yard. However, the plan has been rejected by the union.
The workers of STX started an indefinite strike at the end of March, protesting against the company’s restructuring plan.
STX management said they will hold a board meeting to discuss steps to file for court receivership.
According to KDB, if the court finds STX’s value of liquidation exceeds its going concern value, the shipbuilder will be liquidated, becoming the largest casualty of the shipbuilding downturn to date.
STX was placed under court receivership in 2016 and graduated from the program in July 2017.