By Nam Hyun-woo
A Seoul court decided Thursday to end the bankruptcy protection of Hanjin Shipping, bringing the world's No. 7 shipping company to an end.
Seoul Central District Court ruled to end the receivership, which the shipper filed for Aug. 31, and will receive opinions from creditors for the next two weeks. Though the period is for an appeal, it is non-binding and the court will likely rule for liquidation, Feb. 17.
The decision came after the court finished selling off Hanjin's key assets, including its 20 percent stake in Total Terminals International LLC (TTI), a U.S. port terminal operator, to domestic rival Hyundai Merchant Marine.
Another key asset, an Asia-North America shipping route, was acquired by Samra Midas Group, which created a new container line SM Shipping.
Hanjin shares have now been suspended from trading on the domestic bourse.
The court's decision came after a report by Samil PricewaterhouseCoopers (PwC), which was appointed to assess Hanjin's financial status. Samil PwC said: "the liquidation value of the shipping company stands at 1.8 trillion won ($1.57 billion), but its going concern value could not be assessed because of high uncertainty."
Should the liquidation ruling be upheld, Hanjin, the country's No. 1 shipper since its foundation in 1977, will no longer exist.
The shipping firm's crisis started after the 2008 global financial crisis. As the slump in the global shipping industry became protracted, the company hit a liquidity crisis; and then-Chairwoman Choi Eun-young could not rescue it. Hanjin suffered losses amounting to hundreds of billions of won from 2013 and saw its vessels seized as it failed to pay rental costs.
After it filed for a court receivership, its fleet was stranded and ships were seized, causing serious chaos around the world. This dealt a heavy blow to Hanjin's business network and led its key workforce to leave.
The remaining fallout from the shipper's liquidation is a looming massive layoff. At the end of the third quarter last year, there were 1,356 registered Hanjin employees. Adding those at related or partner companies, the number of people affected is estimated to stand at 3,000.
A Seoul court decided Thursday to end the bankruptcy protection of Hanjin Shipping, bringing the world's No. 7 shipping company to an end.
Seoul Central District Court ruled to end the receivership, which the shipper filed for Aug. 31, and will receive opinions from creditors for the next two weeks. Though the period is for an appeal, it is non-binding and the court will likely rule for liquidation, Feb. 17.
The decision came after the court finished selling off Hanjin's key assets, including its 20 percent stake in Total Terminals International LLC (TTI), a U.S. port terminal operator, to domestic rival Hyundai Merchant Marine.
Another key asset, an Asia-North America shipping route, was acquired by Samra Midas Group, which created a new container line SM Shipping.
Hanjin shares have now been suspended from trading on the domestic bourse.
The court's decision came after a report by Samil PricewaterhouseCoopers (PwC), which was appointed to assess Hanjin's financial status. Samil PwC said: "the liquidation value of the shipping company stands at 1.8 trillion won ($1.57 billion), but its going concern value could not be assessed because of high uncertainty."
Should the liquidation ruling be upheld, Hanjin, the country's No. 1 shipper since its foundation in 1977, will no longer exist.
The shipping firm's crisis started after the 2008 global financial crisis. As the slump in the global shipping industry became protracted, the company hit a liquidity crisis; and then-Chairwoman Choi Eun-young could not rescue it. Hanjin suffered losses amounting to hundreds of billions of won from 2013 and saw its vessels seized as it failed to pay rental costs.
After it filed for a court receivership, its fleet was stranded and ships were seized, causing serious chaos around the world. This dealt a heavy blow to Hanjin's business network and led its key workforce to leave.
The remaining fallout from the shipper's liquidation is a looming massive layoff. At the end of the third quarter last year, there were 1,356 registered Hanjin employees. Adding those at related or partner companies, the number of people affected is estimated to stand at 3,000.
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