Asia/Pacific News
Sanko Line Files for Bankruptcy, Appoints New CEO
Japan's Sanko Steamship Co., Ltd. (Sanko Line) has filed bankruptcy today, the company has announced in a press release.
"We have reached a conclusion in light of our current circumstances that the best way of our reorganization is to file a petition for commencement of corporate reorganization proceedings," the statement read.
Business information service Teikoku Databank Ltd said the 78 year old company's liabilities amounted to $1.95 billion or 155.8 billion yen.
The corporate reorganisation proceedings Sanko Line has filed under will allow the company's existing management to oversee the restructuring process, with Sanko Line also saying Hisashi Asafuji, formally Senior Managing Executive Officer, was taking over from Takeshi Matsui as President and CEO effective today.
The Tokyo headquartered company said profitability had rapidly and seriously deteriorated following a sharp drop in freight and charter revenue caused by a growing gap between supply and demand since 2008, and they were unable to address in-place high-cost charter contracts.
Sanko Line said it was forced to give up on an out-of-court solution that it had been searching for since March and decided to protect itself from creditors.
"We have experienced a severe cash flow problem after some ship owners attached our vessels and hire claims, and withdrew their vessels as a response to our deferral payment," it said.
Sanko Line, who say its fleet of 185 vessels includes bulk carriers, liquefied petroleum gas (LPG) carriers, container ships, and tankers, had one of its dry bulk vessels arrested in the U.S. in May due to outstanding debts.
Sanko Line previously filed for bankruptcy on August 12, 1985 with reported liabilities of 500 billion yen, with the Chicago Tribune saying at the time that banks had been lending the firm $21 million a month.
