Dongwon, Harim Group bid for HMM, reports say

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Dongwon, Harim Group bid for HMM, reports say

Published: 23 Nov. 2023, 19:05

JIN MIN-JI
[email protected]

Dongwon and Harim Group participated in a bid to acquire container shipper HMM, according to media reports on Thursday, paving the way for the deal that could fetch up to 7 trillion won ($5.4 billion).

Dongwon Group confirmed it took part in the bid, but Harim Group could not be reached.

Korea Development Bank (KDB), the main creditor of HMM, said it cannot confirm the companies that took part in the bidding, which is being supervised by Samsung Securities. The bank said there was more than one bidder and the preferred bidder is expected to be announced early next month.

"A workable competition has been established for HMM," said KDB following the bid.

Korea Ocean Business Corporation is another creditor of the country’s largest shipping company.

Dongwon and Harim Group, alongside LX International, were all shortlisted as candidate buyers.

Dongwon Group could leverage synergies with HMM through its land logistics subsidiary, Dongwon Loex. Harim is the parent company of Pan Ocean, the country’s largest dry bulk shipping company.

The total number of shares for sale is 397.9 million, with the anticipated selling price expected to be between 5 trillion won and 7 trillion won.

However, some worry that the companies' bidding prices may fall short of the amount desired by KDB, which could lead to the collapse of the process.

HMM has been under a creditor-led debt restructuring scheme since 2016. Its business boomed during the Covid-19 pandemic on a rapid rise in freight charges, but the business flopped this year as freight charges slid back.

Its stock is down almost 70 percent from the peak in 2021. Its shares closed up 0.86 percent on Friday to close at 16,330 won ($12.5).

KDB and other creditors plan to review the financial status, managerial capabilities and operational plans of the companies participating in the bidding.

BY JIN MIN-JI, KIM JU-YEON, YONHAP [[email protected]]