Subsidiaries of the debt-ridden STX Group are undergoing major restructuring. In addition to downsizing, STX affiliates are intensifying efforts to improve their financial structure and attain management normalization.
According to the STX Group on November 6, both STX Engine and STX Heavy Industries have entered into a joint management agreement with creditor banks, following STX Offshore & Shipbuilding. STX Pan Ocean and STX Construction have already filed for court receivership. In particular, STX Pan Ocean recently submitted a proposal to revive its business. It plans to minimize debt by selling buildings, ships, and others while waiting for the proposal to be approved.
Meanwhile, STX Offshore & Shipbuilding is discussing corporate restructuring with the Korea Development Bank. It was reported that the company will focus on the construction of commercial ships, special purpose vessels, and small and mid-sized marine support vessels.
Finally, STX Group’s holding company, STX Corp., is now preparing for a joint management agreement with creditors. The company is planning to discuss an autonomy agreement with creditors starting on November 27. Once the agreement is reached, it can defer the repayment of bond principal.
Specifically, the company plans to strengthen the general trading businesses in order to generate profits. It will not seek dividend income or product commissions from affiliates facing financial difficulties. The trading businesses include coal and oil trading, import and export of steel and minerals, machinery and plant trading, engine marketing, and shipping and logistics services. It is seeking to increase the proportion of external transactions from 65% to 96% by 2017.
With the help of lowered interest rates, STX Corp. will take a step toward management normalization and the finalization of STX Group’s restructuring.