Ailing container shipper Hanjin Shipping and its three publicly traded affiliates face a 3.4 trillion won ($2.96 billion) wall of debt coming due by the end of next year, data showed Sunday.

According to data compiled by Chaebul.com, an online financial information provider, four Hanjin Group companies -- Hanjin Shipping, Korean Air Lines, Hanjin KAL and Hanjin Corp. -- have to repay a combined 1.49 trillion won in loans this year and another 1.55 trillion won by the end of next year. 

“Troubles at Hanjin Shipping have been spilling over to the group’s financially sound units like Korean Air,” an industry insider said.

As a liquidity crunch continues at Hanjin Shipping, the country’s largest container carrier and the world’s ninth by capacity, the group’s other units were mobilized for support.

In February, national flag carrier Korean Air bought perpetual bonds -- bonds with no maturity date -- issued by Hanjin Shipping worth 220 billion won. The same month, the group’s holding firm Hanjin KAL spent 111.3 billion won to take over the “Hanjin” trademark rights from the shipper.

The group on Friday decided to take Hanjin Shipping into creditor-led rehabilitation, leaving the unit’s fate in the hands of its creditors. State-run Korea Development Bank is its main creditor.

NICE Investors Service, a local credit appraiser, slashed Hanjin Shipping‘s credit rating to junk-bond level and put it on a watch list for a further downgrade. Analyst Kwak No-kyung said in the report that other Hanjin companies were under review for potential credit risks stemming from the liquidity crisis at Hanjin Shipping.

Hanjin is not alone in its plight, as a slump continues in the global shipping industry that is stuck with years of overcapacity and slowing trade worldwide. Its smaller local rival, Hyundai Merchant Marine, is already a month into a “partial” debt settlement agreement with creditors, also led by KDB. 

Hyundai Merchant’s creditors are waiting for the outcome of the company‘s negotiations with ship owners to lower charter fees before deciding whether to roll over some of the loans or provide new loans.

According to the Chaebul.com data, Hyundai Merchant has to repay 1.45 trillion won in debt by the end of next year. 

By Lee Sun-young
(milaya@heraldcorp.com)