PwC Advises Court to Liquidate Hanjin Shipping

boston
File image

By MarEx 2016-12-13 20:15:16

On Tuesday, the South Korean division of global accountancy firm PricewaterhouseCoopers (PwC) recommended the full liquidation of the bankrupt container carrier Hanjin Shipping. 

“Liquidating Hanjin is more economically viable than letting it continue business on a going concern basis,” the firm said in a Korean court filing.

PwC put the value of Hanjin's assets at $1.5 billion.

Hanjin has until February of next year to submit a rehabilitation plan to the court overseeing its receivership; however, the court has already begun auctioning off major assets.

In November, Korea Line submitted a winning bid for Hanjin's Pacific routes shipping business, including client management information, units in the United States, China and Vietnam, and assets and manpower related to logistics systems.

In early December, Korea Line's owner, SM Group, said that it had withdrawn a bid for Hanjin's stake in the Total Terminals International terminal at the Port of Long Beach. MSC and Hyundai Merchant Marine are said to be cooperating on a bid for Hanjin's 54 percent share in the facility; MSC already holds 46 percent ownership. 

Turmoil in government leadership begins to ease

South Korea's financial regulators, notably the Financial Services Commission (FSC), have played a key role in overseeing the reform of the nation's troubled shipping and shipbuilding sectors. Despite recent political upheaval, a new decision by South Korea’s acting president appears to indicate stability at these key agencies.

In November, President Park Geun-hyue dismissed her entire cabinet, part of an effort to stem an explosive scandal over charges of influence-peddling. She relieved incumbent finance minister Yoo Il-Ho and appointed the FSC's chairman, Yim Jong-yong, to take his place.

President Park was impeached and suspended from official duties on Friday. Yim's appointment as finance minister was never confirmed. 

Following the impeachment, Prime Minister Hwang Kyo-ahn assumed the post of acting president. In his first major decision on domestic matters, Hwang ordered that both Yoo and Yim should remain in their current posts without changes.

"It's fortunate that there have been swift decisions . . . retaining Deputy Prime Minister Yoo in his post," Baek Woong-ki, a professor at Sangmyung University, told Yonhap. "[Hwang] seems to have placed more emphasis on the continuity [of economic policy]."