STX Shipbuilding & Sungdong Shipbuilding Or Merging

- Jan 30, 2018-

According to Korean media reports, South Korean medium-sized shipbuilding STX marine shipbuilding and Sungdong  Sungdong  shipbuilding or merger. As creditors to two shipping companies, the Export-Import Bank of Korea and KDB are negotiating the possibility of a merger.

 

Last August there was news that the South Korean government plans to merge STX Marine Shipbuilding and Sungdong  Shipbuilding and meet to discuss the merger. The South Korean government plans to streamline and merge the two shipyards based on the findings. glenflange

 

Currently, STX Shipbuilding is managed by Korea Industrial Bank, while Seongdong Shipbuilding is managed by Korea Export-Import Bank. Eun Sung-soo, chief executive of the Export-Import Bank of Korea, said the two banks are discussing the merger of STX and Sungdong  Shipbuilding, but no concrete plans have been made so far.

 

In the past few years, the reduction of hand-held orders and overcapacity have forced major South African shipping companies to implement large-scale restructuring measures, including the sale of assets, layoffs and production cuts to ensure continued operations. However, medium-sized shipping companies such as STX, Shingdong Shipbuilding and so on can hardly follow the example of self-help measures of large shipping companies. The restructuring procedures of these medium-sized shipping companies are directly interfered by the state-owned banks of South Korea and other non-commercial banks.glenflange

 

STX Shipbuilding was once the world's fourth-largest shipbuilding company. However, as the shipbuilding industry continued to decline, STX shipbuilding experienced a prolonged downturn and increased losses. Since 2013, STX Shipbuilding began debt restructuring under creditor control. In May 2016, STX Shipbuilding Co., Ltd. applied for a court takeover in South Korea and prepared a new reorganization plan, including asset sales, cost cutting and debt-to-equity swap.

 

South Sungdong  City Shipbuilding was once the world's largest medium-sized boat, hand-held orders once ranked the world No. 10. Since 2010, Chengdong Shipbuilding has been in financial difficulties and has won more than 4 trillion won (about 3.6 billion U.S. dollars) in succession from creditors in recent years. At present, Chengdong Shipbuilding owns 3 shipyards in Tongyeong. At present, only one is still operating.