Hanjin Shipping Set to Be Scrooge of the Holiday Season
- Author: Delia Davidson Sep 20, 2016,
Sep 20, 2016, 9:30
Hanjin Group said Tuesday it will inject $90 million, including $36 million from its chairman Cho Yang-ho's personal assets, to help resolve disruptions to container cargo transport caused by Hanjin Shipping Co.'s financial troubles.
Similar actions are pending at courts around the world, as well as the company's main action seeking government receivership in its native country.
"We have the money", said Ilana Volkov, an attorney for Hanjin, told a U.S. Bankruptcy Court hearing in Newark, New Jersey on Friday.
The shipping line asked the court to protect its assets in the U.S. against enforcement actions and seizure attempts by its creditors.
A Korea Development Bank spokesman said providing extra funding to Hanjin could lead to breach of trust issues as there was no certainty that additional support would help the company survive.
According to AP, Hanjin, the world's seventh largest container shipper, said it had filed for creditor protection in dozens of countries, which would free vessels to land without being seized.
An American court temporarily approved Hanjin Shipping's application for bankruptcy protection. There could be some impact on ports and the shipping industry and the government has set up a task force to ensure there are no delays to cargo flow, the agency said.
Hanjin ship captains have said they are running low on all supplies, rationing water and fuel to conserve what little supply they have left in case the matter isn't resolved soon.
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Reuters quoted Ilana Volkov, an attorney for Hanjin, as telling the USA bankruptcy court that the company had at least $10m authorized by the Korean courts to allow four vessels off the United States to come into port and unload their cargoes.
Officials from the US Department of Commerce will meet with Korean counterparts to discuss measures against Hanjin Shipping's fallout that has deal a blow to the US retailers, local news reported on September 9.
Hanjin has been struggling to arrange financing to resume normal operations.
The judge asked companies along the supply chain to hammer out a protocol agreement over the weekend that would get goods moving again.
The four ships are Hanjin Greece, Hanjin Gdynia, Hanjin Jungil and Hanjin Boston.
The South Korean shipping company operates 97 container ships, the giant workhorses of global trade that deliver everything from computers and clothing to televisions and toys.
But Hanjin representatives will have to appear in court again on Friday, and there's no indication whether they'll be able to come up with enough emergency cash to unload the billions of dollars in cargo now tied up around the world.