As Hanjin's vessel assets find a home, its terminal asset transfer is challenged
- Bankruptcy deals may not always be in the best interest of other stakeholders, such as ports or creditors, as showed by recent news revealing challenges to Hanjin's initial asset sales.
- While Hanjin's vessel assets finally found a new home within the newly-incorporated SM Line, the initial sale to Korea Line was rejected by the latter company's stakeholders.
- Meanwhile, the Mediterranean Shipping Company may be facing similar challenges as its West Coast terminal purchases are now being separately challenged at a U.S. Bankruptcy court, according to various reports.
Among the many problems caused by Hanjin Shipping's bankruptcy filing, some of the most disruptive were caused by the shipping line's creditors. Concerns over charter payments and other terminal processing fees led some vessels to remain stranded outside global ports for fear of asset takeover. In turn, many companies' supply chains were disrupted by long or indeterminate delays on their goods.
While that crisis has largely concluded, similar concerns over payments and profitability are driving a slew of new problems for the bankrupt carrier. The Wall Street Journal reports creditors are challenging MSC's purchase of its Long Beach, CA terminal, American Shipper notes the Northwest Seaport Alliance objected to a similar lease takeover for Hanjin's Terminal 46 at the Ports of Seattle and Tacoma. Hanjin's lawyers reportedly are arguing a blocked sale would cause "irreparable harm" to the shipping line. A hearing is reportedly scheduled Thursday to determine the fate of the West Coast ports.
Despite these challenges, some good news came to Hanjin this week. Despite a long delay to Korea Line's purchase of its vessel assets, Hanjin essentially has a successor line in the form of SM Line, which was officially incorporated this week and intends to "gradually" acquire 12 container ships to begin operations by March. In addition, the line is negotiating entry into Hyundai Merchant Marine's new regional alliance HMM + 2K.
Overall, the challenges for a Hanjin recovery are looking increasingly insurmountable. The once-seventh-largest shipping line originally intended to become a regional carrier, but the incorporation of a successor line and continued creditor challenges have long made liquidation the apparent best route as competitors and stakeholders compete for the company's assets.
- Business Korea SM Line Formally Launches after Taking over Assets from Hanjin Shipping
- American Shipper NWSA objects to terminal sale
- Pulse New SM container line to join Korea’s local shipping alliance
- The Wall Street Journal U.S. Creditors Raise Concerns With Hanjin Terminal Sale
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