HMM bidding narrows to two South Korean groups

A container ship of HMM (Photo: VesselFinder)

Dongwon, South Korea's largest fishing company, and Harim, the parent company of Pan Ocean, the largest breakbulk shipping company in South Korea, submitted their bids when the bidding process ended at 5 p.m. local time on November 23.

LX International, a South Korean trade and logistics conglomerate, alongside Dongwon and Harim, made it to the shortlist but decided not to continue. Explaining their decision, an LX International representative stated, "Considering the market situation and business environment comprehensively, we decided not to participate."

The Korea Development Bank and the Korea Ocean Business Corporation, representing the state's interest in HMM, will evaluate the financial status, management capabilities, and business development plans of the bidders.

The preferred bidder is expected to be selected as early as this month or by the end of the year. KDB officials mentioned that the preferred buyer would take up to two weeks to be chosen after consulting with relevant agencies.

KDB and KOBC are selling shares amounting to 40.65%, which could rise to 57.87% if 1 trillion KRW (742 million USD) in bonds are converted into shares, estimated to be worth between 5 trillion KRW (3.5 billion USD) and 10 trillion KRW (7.4 billion USD).

Therefore, the financial capability of the bidders is key to gaining favor with HMM stakeholders.

Dongwon Group has brought its subsidiary 3PL Dongwon LOEX to bid for HMM, reportedly considering additional debt through bank loans and issuing convertible bonds. Local media also reported that Dongwon might sell some of its assets and shares in its branches.

The group is also considering raising more funds by listing its US-based tuna processing subsidiary, StarKist.

Dongwon hopes that with HMM's potential, the company can develop into a comprehensive transportation and logistics group.

Harim Group is collaborating with JKL Partners, a private limited company from the same hometown, which helped them repurchase Pan Ocean in 2015 to ensure financial stability. Pan Ocean had sold some oil tankers and its entire stake in the parent company, Hanjin KAL of Korean Air Lines.

Read more:

• Will the South Korean Government Sell HMM?
• HMM enhances Intra-Asia Cross Network service
• Hapag-Lloyd Excluded from HMM's Second Round of Bidding
• SM Group Abandons HMM Acquisition Ambitions
• HMM reports a more than 90% drop in profits in the first half of the year

Source: Phaata.com (According to ContainerNews) 

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