SEOUL, KOREA - STX Pan Ocean, the bulk carrier unit of STX Group, will finally file for court receivership, following a series of failed attempts by its parent group to sell it off to other suitors including Korea Development Bank. According to financial regulators, the company will apply for court receivership with the Seoul Central District Court after a board of directors meeting on June 7.
A regulator said, "STX Pan Ocean decided to file for court receivership after weighing options between acquisition by Korea Development Bank and court receivership. It finally leaned toward court receivership because of worries about potential weak performance and accountability."
WIth this, STX Pan Ocean went back to court receivership after 20 years in 1993 when it was formerly Pumyang Shipping. Pumyang changed its name to STX Pan Ocean in 2004 when it was acquired by STX Group. Once the company moves under the protection of court receivership, it can be free from the burden of repaying debts.
STX Pan Ocean, Korea's No. 1 bulk carrier, has suffered large losses since the 2008 global financial crisis, with its 2012 net loss approaching 460 billion won. After due diligence by Korea Development Bank, it turned out, the company's debt was in excess of 5 trillion won including 1.2 trillion won in corporate bonds outstanding, which makes its survival highly doubtful.
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