HMM expects to arrive at charter rate agreement with shipowners soon
Time：2016-06-01
Browse：143
Hyundai Merchant Marine now expects to reach an agreement soon with foreign shipowners regarding its proposed charter rates reduction, reported Lloyd`s List.
The troubled South Korean shipping line, which has been negotiating charter fees with 22 shipowners, said that it achieved "meaningful progress" in its charter negotiations with five container shipowners, without identifying them.
HMM`s statement came a day before HMM is expected to conclude its charter rate negotiations. The carrier, South Korea`s second-biggest, is also "putting its utmost efforts" in reaching agreements with bulk ship owners by handing them final proposals.
Once the negotiations are finalised, HMM said it would make a public announcement following discussions with creditors.
HMM also warned against speculative media reports regarding the charter rate negotiations. "Such ill-informed [reports] can pose serious threats to not only our ongoing discussions about charters but also the company`s business normalisation."
"We firmly ask media to take extra care when reporting about the matter until the charter negotiation is completed successfully," HMM added.
HMM will hold a briefing about the progress of charter negotiations at its meetings with bondholders on May 31 and June 1 and will seek creditors` support and cooperation.
HMM on Friday said negotiations with shipowners to cut rates on chartered vessels were still ongoing, despite local media reports that agreements had been reached.
The shipping line said on May 24, 2016 that its creditors had agreed to convert KWR700 billion (US$593 million) of loans into company stock, but the move depended on the carrier obtaining charter rate cuts and on bondholders approving a debt adjustment plan.
HMM has fulfilled requirements to meet with holders of KW804.2 billion worth of public bonds maturing this year and in 2017, it said in a statement, adding that five bondholders` meetings had been set for May 31 and June 1 this year.
The Financial Services Commission, South Korea`s financial regulator, has said that if HMM`s charter negotiations failed, it "would be difficult for HMM to get back on track", adding that failure would mean there would be "few options for creditors to choose".
HMM has been in talks with four owners of its chartered ships and seeks to reduce costs by as much as 30 per cent, according to local reports which HMM would not comment on. Korea Development Bank earlier confirmed negotiations between HMM and four owners of chartered ships but did not give details.