Hyundai Merchant Marine announced on 21st July that it signed an agreement with its creditors to proceed with its business normalization plan. According to this agreement, one of HMM’s creditor banks, the Korea Development Bank became the largest shareholder of HMM following a debt-for-equity swap. As a result, HMM this month issued 280 million new shares at $8.23 each. The share were given to shareholders, creditors, bondholders and shipowners in a debt-to-equity swap that reduced HMM’s debt load.

Creditor banks got 684 billion South Korean won ($602.3 million) of the new shares and bondholders applied for shares worth more than 420 billion South Korean won. The latest round of debt-for-equity swaps has brought the company’s debt ratio from 5,307 percent on March 31 to 200 percent, an important milestone for the company because that is the level at which it can tap government funding for mega-ship newbuilds.

“The issuance of new shares has successfully transformed out debt ratio into 200 percent, turning us into a blue-chip shipping company,” HMM said. “We expect to achieve stable sales under the management of our creditors and the implementation of our business normalization plan.”

Source : HMM website (http://hmm.co.kr/cms/company/engn/introduce/prcenter/news/1200973_7540.jsp)