Cash-strapped Hanjin Shipping Co. is seeking to trim its workforce ahead of a planned sale of its key assets, industry sources said Wednesday.
According to the sources, Hanjin Shipping, which is currently under receivership, has decided to dismiss more than half of its land-based employees by early December and gave the relevant notice to their labor union.
After the massive dismissals, only 300 employees involved in the shipper’s U.S. and Asian route business will stay, they noted. Hanjin Shipping, the country’s No. 1 shipping line, recently got the nod from a local court to sell off its U.S. and Asian route business.
The shipper has reportedly ruled out any retirement consolation benefits in the upcoming manpower reduction.
The Seoul Central District Court will receive letters of interest from potential buyers until Oct. 28. Potential bidders are required to offer final bids by Nov. 4 and will be given the opportunity to conduct due diligence.
The asset sale will be completed by the end of next month, but the prices were not determined.
Hyundai Merchant, its smaller local rival, said earlier it will bid for the assets up for sale.
Hanjin Shipping’s Asia-U.S. route logs sales of up to 4 trillion won annually, and its market share stands at 7 percent, the sixth-largest among global shippers.
Hanjin Shipping’s receivership sent ripples through the global shipping network and left more than half of its ships stranded at sea. The company badly needs cash to repay debts and meet unpaid service bills. At the end of June, its debt reached 6 trillion won.
Earlier, the government said Hyundai Merchant would consider taking over Hanjin Shipping’s healthy assets such as port terminals and global business networks.
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