FSC Chairman Refuses to Rule Out Merger of Hanjin Shipping and HMM

Lim Jong-ryong, chairman of the Financial Services Commission (FSC), said on June 13 that the merger of Hanjin Shipping and Hyundai Merchant Marine (HMM) can be considered when the two companies complete the management normalization. 

During a regular press conference on the same day, Lim said, “We will consider whether to merge or support the competitive system after watching the normalization of Hanjin Shipping.”

In this regard, he said, “The possibility of the merger is not so different from the direction of our restructuring plans for shipping companies revealed earlier. The two companies should normalize their business first by readjusting charter fees, adjusting debts with bondholders, adjusting debts with creditors and joining a shipping alliance. It means that we will review whether to merge the two companies or maintain the competitive system is better for the shipping industry only after both companies have been normalized.”

An official from the FSC said, “HMM has turned the corner of normalization but Hanjin Shipping is still in an uncertain situation. The merger is impossible at the current state. It can be reviewed only after Hanjin Shipping secures the liquidity of more than 1 trillion won (US$851.79 million). The merger will be considered when the two companies meet the prerequisites.”