HMM Says Preliminary Bid for Hanjin Asia-U.S. Assets Possible

HMM is considering the submission of a preliminary bid for Hanjin's assets used on Asia-to-U.S. routes.

Hyundai Merchant Marine Co Ltd (HMM) Tuesday said it is considering the submission of a preliminary bid for Hanjin Shipping Co Ltd (Hanjin) assets used on Asia-to-U.S. routes, Reuters reports.

As Ship & Bunker reported last week, a list detailing over 3,000 creditors of bankrupt Hanjin was released, including ten bunker companies that are collectively owed around $64 million.

While the extent of other bidding interest in the assets is reported to be unclear, news of HMM's interest is said to currently mark Hanjin's best prospects toward paying off its creditors

"Container shipping is a service business and anybody acquiring it would be worried about potential legal suits as well despite the sale being ring-fenced," said Rahul Kapoor, director at Drewry Financial Research Services.

"Why would one pay for a ghost network when the credibility of that network has been under threat," added Kapoor, noting that 8-10 year old container, worth an estimated $15 million to $18 million each, would be the only assets with any value.

According to South Korean shipping sources, established shippers are unlikely to show interest in Hanjin's manpower and logistics systems, although a newcomer may not have their own fully established and may find them valuable.

Further, government sources are reported to have noted that the South Korean government may see a bid by HMM in a favourable light if it supports HMM in the expansion of its market share or helps to normalise its business.

The vessel sales are to be completed by Hanjin's own internal ship sales department, rather than independent ship brokers, said a Seoul-based ship broker.

It is reported that none of Hanjin's interests in port terminals are currently included in the sale.

Hanjin, once the world's seventh largest box carrier, filed for court protection on August 31, 2016.

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