[THE INVESTOR] Hanjin Shipping is planning on submitting a self-rescue plan to creditors this week to stave off bankruptcy, local news reported Aug. 22.

“We are planning on presenting the plan by Aug. 25,” a representative from Hanjin Shipping said. According to the shipper, the plan includes details on securing funds from its parent Hanjin Group and cutting charter fees from foreign vessel owners. 


Once the self-rescue plan is submitted, the creditors -- led by the state-run Korea Development Bank -- will decide whether it will give some breathing room to the shipper to stay afloat, such as by extending the maturity period of its debt or offering an equity swap for loans.

But if Hanjin Shipping fails to receive the green light from the creditors by the due date of Sept. 4, it seems unlikely the shipper will avert court receivership.

The creditors have warned Hanjin Group to show more substantial effort to save its shipping arm by injecting more cash for Hanjin Shipping to avoid bankruptcy.

The nation’s largest container carrier has been under creditor-led rehabilitation -- with conditions attached -- since May due to the escalating debt level, hit by falling ship prices amid a global economic slump.

By Ahn Sung-mi (sahn@heraldcorp.com)