[THE INVESTOR] Hanjin Group chairman Cho Yang-ho sat down with Gerry Wang, the owner of the world’s largest container firm Seaspan Corp., to persuade him to cut chartering prices. Wang reportedly responded “positively” to Cho’s overtures, according to Hanjin Shipping executives.

This is the first time that Cho stepped up to directly intervene in ship charter cost issues.

Cho met with Wang on June 14 at the Korean Air headquarters in downtown Seoul. 

In May, Wang had told the press that he has refused a request from Hanjin to cut chartering fees by 30 percent.

Hanjin Shipping -- the world’s seventh-largest shipping line -- currently shoulders up to 1 trillion won ($849 million) annually on the costs of chartering 91 out of the 151 vessels it runs.

Among them are seven 10,000 twenty-foot equivalent units (TEU) container ships owned by Seaspan.

Cutting chartering costs is a crucial part of the restructuring process Hanjin is undergoing. In early May, creditors of Hanjin Shipping approved a creditor-led restructuring for the shipper, granting a three-month suspension on all payments of principal and interest. Hanjin cannot avoid hope to court receivership if it fails to cut costs from container owners by the end of July.

In addition to charter costs, the two agreed to cooperate on Ecoship principles, under which an increasing number of shipping firms and shipbuilders are working together to help reduce shipbuilding costs, according to Hanjin officials.

(theinvestor@heraldcorp.com)