Hyundai Heavy wins approval on W3.5 trillion self-rescue plans

Embattled Hyundai Heavy Industries has mapped out 3.5 trillion won ($2.94 billion) worth of self-rehabilitation measures, including asset sales and a cut in its workforce, in order to stay afloat amid a drop in new orders, industry sources said Wednesday.

Under the shipbuilder's self-rescue plans, temporarily approved by the financial authorities and its creditors, led by KEB-Hana Bank, it will sell stocks that it invested in, non-core assets and cut its workforce, which will reduce its debt-to-equity ratio to below 100 percent by 2018.

As of end-March, the shipbuilder's debt stood at 8.5 trillion won, with its debt ratio standing at 134 percent.

Since September 2014, Hyundai Heavy has already implemented self-rescue measures worth 3.9 trillion won.

The shipbuilder swung to the black in the first quarter for the first time in 10 quarters with an operating income of 325 billion won, aided by its stronger restructuring efforts.

Its local rivals -- Daewoo Shipbuilding & Marine Engineering and Samsung Heavy Industries -- have submitted their own self-rehabilitation measures to their creditors.

The country's top three shipyards suffered a combined operating loss of 8.5 trillion won last year due largely to increased costs stemming from a delay in the construction of offshore facilities and an industrywide slump. (Yonhap)