South Korea’s Hyundai Merchant Marine said on Tuesday it may submit a preliminary bid for Hanjin Shipping assets used in Asia-to-U.S. Routes—a sale seen as key to Hanjin’s prospects for paying off creditors.
Hanjin, the first major shipping line to be dragged down by global industry overcapacity and low freight rates, put up manpower and logistics systems, five container ships and 10 overseas businesses, for sale last week.
Shipping sources in South Korea have said that potential interest in the assets is unclear, particularly for the manpower and logistics systems that established shippers already have. But they added that the networks and systems could be valuable to a newcomer looking to enter the shipping industry.
Likely valuations for the assets were not immediately known.
A bid by Hyundai Merchant Marine would be looked on favorably by the South Korean government if it helps Hyundai Merchant Marine expand market share or normalize its business, government sources have said.
A Hyundai Merchant Marine spokesman said that while the firm was considering the bid it had not made a final decision.
The court overseeing Hanjin Shipping’s receivership said the five container ships up for sale each had a cargo capacity of 6,500 twenty-foot equivalent units (TEUs).
Container ships of that size are fit for West Asia routes such as routes between India and other Asian destinatons, which are served by shippers such as Hyundai Merchant Marine or Singapore’s PIL, the sources said. They declined to be identified as they were not authorized to speak to the media.
None of Hanjin Shipping’s interests in port terminals around the world are included in the sale at the moment.
Hanjin, which filed for court receivership on Aug. 31 after its creditors cut off financial support for the firm, had total debt of 6.03 trillion won ($5.4 billion) as of end-June.