HMM sale to face hurdles amid slowdown in shipping industry
The sale of South Korea's No. 1 container shipper HMM, which is anticipated to be one of Korea's largest mergers and acquisitions transactions for the second half of 2023, is expected to hit a snag amid a slowdown in the shipping industry, according to industry sources on Sunday.
In July, Seoul-based investment bank Samsung Securities, which is supervising the sale of HMM, formerly known as Hyundai Merchant Marine, initiated the sale of Korea Development Bank and Korea Ocean Business Corp.'s stake in HMM.
Both parties, who are the largest shareholders of HMM with 20.69 percent and 19.96 percent stake in HMM, respectively, are selling a total of 199 million shares via the process. Also, 200 million shares of HMM are scheduled to be additionally converted from perpetual bonds to be sold during the process.
Earlier this month, acquisition candidates for HMM were narrowed down to a three-way race between Korean fisheries firm Dongwon Industries, food giant Harim and LX Group. In November, KDB is reportedly scheduled to select its preferred bidder for the acquisition.
Regarding the sale, industry watchers say tumbling demand for maritime transport is expected to function as a burden for potential acquirers.
"Amid the global recession in the maritime transport industry, HMM's performance has been dwindling. With the acquisition of all of KDB's shares and Korea Maritime Development Corp.'s share in HMM expected to cost at least 5 trillion won ($3.6 billion), acquiring the company could work as a winner's curse at this timing," said a shipping industry official on the condition of anonymity.
As of Sept. 29, the Shanghai Containerized Freight Index, which calculates the fares of 15 of the most frequently used sea routes around the world and functions as a metric for demand in the maritime transport, shrank to 886.85, logging a 53 percent on-year decrease.
"The three highs -- high exchange rates, high interest rates and high prices -- are freezing consumer sentiment and decreasing maritime transport volumes overall," said another shipping industry official also on condition of anonymity.
Amid a global slowdown in the shipping industry, HMM's second-quarter numbers tumbled, with its quarterly sales logging 2.1 trillion won, posting a 57.7 percent on-year decrease. The company's operating profits logged 160 billion won, a 94.5 percent decrease from the same period last year.
"If HMM continues to post poor financial results, it could result in a decline in corporate value, and make it difficult to find a buyer. It is true that a low-cost acquisition may speedily end the M&A process, but sellers such as KDB and HMM's shareholders will not desire to sell the company at a low cost," she said.
-
이상민 "현실적 선택지는 국민의힘…12월 초까지 거취 결정"尹대통령 지지율, 1.1%p 내린 38.9% [알앤써치]How college students are coping with the impact of inflation'No Japan?' Korea swings from extreme rejection to selective embrace[Korea Beyond Korea] Korean studies in Turkey grows on foundation of strong relationsHIT forum on space to be held in Seoul[From the scene] Eye[Herald Review] Ive gives a sneak peek of new album, kicks off first world tour with Seoul gigsJeju Island offers many choices for holidaymakers with pets[Our Museums] Explore cinematic treasures at Korean Film Museum
下一篇:Two dead in Gyeongju construction site collapse
- ·러 매체 “北 위성에 러시아 도움, 근거 없다…포탄 지원설도 마찬가지”
- ·Half of Loona restarts as quintet Loossemble
- ·Jungkook becomes first Korean soloist to log 2 songs in Top 5 of Billboard's Hot 100
- ·Seoul shares open higher on US gains; Israel
- ·Former Hungarian ambassador receives Gwanghwa Medal
- ·Half of Loona restarts as quintet Loossemble
- ·Jungkook of BTS to hold fan showcase on Nov. 20
- ·US eases export controls on chip equipment for Samsung, SK factories in China
- ·N. Korea reinstates DMZ guard posts
- ·낙후된 골목시장 누비며 “화곡을 마곡으로 만들 것”
- ·[Today’s K
- ·Samsung, LG, Hyundai closely monitoring potential biz fallout from Israel
- ·Jeju Island offers many choices for holidaymakers with pets
- ·LG Electronics ups Q3 earnings guidance on upbeat demand
- ·How college students are coping with the impact of inflation
- ·Four days of jazz festivities take over Jara Island
- ·Tax refund limit to be doubled for tourists
- ·Uncertainties remain for Samsung, SK after US eases export controls
- ·Seoul shares end lower amid conflict in Middle East
- ·Hanwha showcases ground weapons systems at US trade fair
- ·Hyundai Motor to halt Asan factory in Korea for EV factory construction
- ·[Herald Interview] Singer
- ·For esports fans, more activities await beyond LoL matches
- ·김건희 여사, 광주디자인비엔날레 찾아 “문화예술계 육성 의지”
- ·'12.12: The Day’ attracts 1.8m moviegoers in five days since opening
- ·[Our Museums] Explore cinematic treasures at Korean Film Museum
- ·Plush bag charms in high demand among young Korean women
- ·[Herald Interview] Chung Ji
- ·Han Kang's 'I Do Not Bid Farewell' shortlisted for two French literary awards
- ·[Korea Beyond Korea] Historian looks back at life dedicated to Korean studies
- ·[Herald Interview] Hyundai Motor takes step
- ·Nearly 1 in 3 senior pensioners look to employment to make ends meet
- ·Police slap travel ban on suspected con artist, ex
- ·"식량만 달라" NLL 표류하던 北선박, 어젯밤 北이 끌고 갔다
- ·Hyundai Rotem debuts world's 1st LTE
- ·US, China agree to work towards Biden
- ·'12.12: The Day’ attracts 1.8m moviegoers in five days since opening
- ·'Frasier' returns to TV but you don't need to be a superfan of the original to laugh at its jokes
- ·낙후된 골목시장 누비며 “화곡을 마곡으로 만들 것”
- ·[Test Drive] BMW 5 Series makes more powerful, elegant comeback
- ·Yoon replaces spy agency leadership
- ·사전투표 D
- ·33년 경찰 경력 내세워…“안심구청장 누구입니까”
- ·사전투표 D
- ·'12.12: The Day’ attracts 1.8m moviegoers in five days since opening
- ·[Korean History] 2002, when Korea soared through World Cup