Hanjin’s Cho chips in 40 billion won of his own moneyHanjin Group Chairman Cho Yang-ho delivered 40 billion won ($35.7 millino) of his own money to help clean up the mess at Hanjin Shipping on Tuesday. However, additional money that was supposed to be donated by Hanjin Group didn’t come through and the ruling Saenuri Party urged the group to take responsibility.
A Seoul bankruptcy court concluded that Hanjin Shipping needs around 170 billion won to free cargo trapped in Hanjin-operated vessels around the world, and 600 billion won to fully solve the logistics disturbances and pay uncovered charter rates.
“Korean Air was supposed to deliver 60 billion won with [Hanjin Shipping’s] Long Beach Terminal put up as collateral,” said Yim Jong-yong, chairman of Finance Services Commission during a government-ruling party conference on the Hanjin Shipping mess Tuesday. “However, as its board of directors set a requirement to get a formal loan contract drawn up, the cash delivery is likely to take some time. We cannot be sure if the funding will actually be executed.”
Currently 54 percent of the Long Beach Terminal is owned by Hanjin Shipping while the other 46 percent is owned by MSC, a global container shipping company headquartered in Switzerland. If MSC declines to allow the terminal to be used as collateral, the funding will fall through.
Former chairwoman of Hanjin Shipping Choi Eun-young also pledged to cough up 10 billion won from her personal coffers on Monday.
“The cash will be delivered in a few days without any strings attached,” said a spokesperson of Eusu Holdings, of which Choi is chairwoman.
“As Hanjin Group Chairman Cho decided to offer his own money, Chairwoman Choi decided to do so as well,” another insider from the company added.
While Choi is no longer part of Hanjin Shipping’s management - she stepped down as chairwoman in 2014 - she is blamed for sinking the nation’s No.1 shipping company.
During the years she served as chairwoman, from 2007 through 2014, the company’s debt to equity to ratio went from 155 percent in 2009 to as much as 1,445 percent in 2013.
“As Hanjin Group is the largest shareholder of Hanjin Shipping, it should fulfill the responsibility of normalizing the handling of all cargo,” said Kim Gwang-lim, Saenuri Party’s chief policymaker.
To take care of the most urgent cargo, Hanjin has applied for stay orders on seizures of ships and cargo, and the requests have been approved in Japan, the U.S., United Kingdom and Singapore (temporarily).
BY KIM JEE-HEE [email@example.com]