Hanjin lenders agree to restructuring deal

The troubled South Korean ocean carrier received approval from seven lenders to restructure debts and will now turn its focus to restructuring ship chartering agreements.    Troubled South Korean container line Hanjin Shipping said Wednesday in a corporate filing that its creditor banks have approved its proposal to voluntarily restructure its debts.
   The approval was expected from the seven lending institutions used by the ocean carrier, which include the Korea Development Bank, the Export-Import Bank of Korea, Nonghyup, KB Kookmin, KEB Hana, Woori and Pusan Bank.
   Hanjin is now expected to try to restructure its ship chartering agreements and sell assets as it attempts to recover from several years of weak demand.
   “This approval by the creditor banks will play a crucial role in our discussions regarding alliance reorganization and our business normalization efforts such as charter rate reduction and etc.,” the carrier said in a statement. “As our financial improvement plan will speed up once the voluntary restructuring agreement begins, we will put our utmost effort and work closely with the creditors to achieve business normalization within nearest future.”
   The company reported a net profit of $6 million in 2015, but has been operationally unprofitable for five years. According to reports, it has debts of around $4.4 billion.
   Hanjin is also facing new ocean carrier alliance dynamics over the next 12 months. It is a key member of the CKYHE Alliance, but that alliance is set to lose two members in COSCO Container Lines and Evergreen Line in the first half of 2017 as those two lines transition to the new OCEAN Alliance with CMA CGM and OOCL.