Creditors of struggling South Korean shipper Hyundai Merchant Marine Co Ltd have agreed to a 680 billion won ($570.27 million) debt-for-equity swap, lead creditor bank Korea Development Bank said.
Container lines, which transport everything from bananas to iPhones, are struggling with the confluence of a glut of ships, a faltering global economy and weaker consumer demand.
Hyundai Merchant Marine had debts of about 5.2 trillion Korean won as of the quarter ending in March, according to a company filing. Squeezed by what is widely considered the worst downturn ever for the industry, the Korean shipper is trying to negotiate lower charter fees from shipowners.
The agreement is contingent on conditions including Hyundai Merchant Marine joining an alliance involving major shipping firms. A Korea Development Bank official said the size of stake the creditors will collectively end up with in Hyundai is not yet set.
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