Uncertainty grows over HMM's relocation, new owner
A person passes by an electronic board on the wall of HMM's head office in Seoul, Feb. 7, 2024. Yonhap
President urges struggling shipping firm to headquarter in Busan amid privatization efforts
Korean shipping company HMM has been facing multiple challenges since the beginning of this year.
While it remains uncertain about who will become HMM's new owner and whether the firm will overcome a market downturn, the government has renewed its push to move the company's Seoul headquarters to Busan, Korea's second-largest city which is now home to the Ministry of Oceans and Fisheries.
During Tuesday's livestreamed Cabinet meeting, President Lee Jae Myung asked acting Oceans Minister Kim Sung-bum when HMM will move its head office to the southeastern port city. As Kim cited a prolonged backlash from its labor union, Lee then asked whether its management is also undecided about the relocation.
"Two major privately owned shipping companies decided to relocate their headquarters" the president said. "I listed other shipping firms that could move to Busan if the government persuades them to do so."
Lee added that it is not useful to locate shipping firms' head offices in the capital area, as Kim introduced the ministry's plan to establish a shipping industry cluster through a "big deal" with companies.
President Lee Jae Myung leaves a meeting room after receiving a policy briefing from the Ministry of Oceans and Fisheries at its new headquarters in Busan, Dec. 23, 2025. Yonhap
A week before the president publicly spoke about the issue, HMM CEO Choi Won-hyok told reporters that the company would have no choice but to pursue the relocation, one of the administration's national policy priorities.
"We need to keep communicating with the union to discuss this issue," Choi said Jan. 15.
Competition has also reignited to acquire HMM, which is currently under control of the state-run Korea Development Bank and the Korea Ocean Business Corp. (KOBC) under the supervision of the oceans ministry.
Dongwon Group, which failed in bid to take over HMM in 2023, has not denied speculation that its holding firm, Dongwon Industries, will try to secure 2 trillion won ($1.4 billion) in cash to buy the shipping firm by selling its stake in U.S. subsidiary StarKist to Dongwon F&B, another one of its subsidiaries.
"As the group's holding company, we are considering multiple mergers and acquisitions to discover future growth engines," Dongwon Industries said Tuesday. "As part of efforts to secure cash for this plan, we will ask an external ratings agency to assess StarKist's value. We are also considering raising funds from financial institutions."
Last year, POSCO Group said the company was reviewing whether its acquisition of HMM would create strategic synergy. However, shipping industry officials have opposed the steelmaking group's entry into the market.
Harim Group also remains a major competitor. The poultry processing company was selected as the preferred bidder to buy HMM in 2023, but failed in the acquisition due to differences with the seller about the price.
However, the worsening outlook for the shipping industry could be an obstacle to HMM's privatization. KOBC expects downward pressure in global sea freight rates this year, citing the oversupply of container ships.
According to financial data provider FnGuide, HMM's operating profit in 2025 is estimated to have dropped 60 percent year-on-year to 1.4 trillion won.