Two Chinese shipbuilding companies have expressed intent to invest in debt-riddled Hanjin Heavy Industries and Construction Philippines, the Department of Trade Industry (DTI) said Friday.
The Chinese firms contacted the Board of Investments BOI when they learned through media reports that Hanjin Philippines has filed for a corporate rehabilitation, Trade Undersecretary and BOI Managing Head Ceferino Rodolfo said on the sideline of a press conference in Makati City.
“They’re interested in the shipbuilding industry in general … but there is an opportunity now with what happened in Hanjin, so we’re linking the investors with Hanjin,” Rodolfo said.
Hanjin Philippines filed on Tuesday a petition before the Regional Trial Court in Olongapo City for voluntary rehabilitation under Republic Act 10142 or “An Act Providing for the Rehabilitation or Liquidation of Financially Distressed Enterprises and Individuals.”
Hanjin Philippines officials revealed to the Subic Bay Metropolitan Authority that the company has around $400 million in outstanding loans from Philippine banks on top of $900 million in debts owed to South Korea lenders.
The Korean shipbuilder is the biggest foreign investor in the Subic Bay Freeport Zone, according to SBMA.
“What this development in Hanjin presents now, it gives investors another entry strategy … These companies that we talk to can look into a possible takeover of Hanjin as a way of entering the Philippine market rather than starting from scratch,” Trade Secretary Ramon Lopez said in a separate interview.
Rodolfo declined to identify the Chinese firms other than saying one is state-owned and among the top three in the China’s shipbuilding industry.
“They’re in full-range. They can produce big ships and small ships,” Rodolfo said.
The other is a smaller company but with the capacity to produce big ships.
It would be a viable alternative for interested investors in the shipbuilding sector to takeover Hanjin, Lopez noted. “That’s an option, if you’re coming in. Dati it’s just a startup … and you have many , including Hanjin. Now, you’re buying a possible competitor.”
Established in 2006, Hanjin Philippines is a subsidiary of Hanjin Heavy Industries & Construction Co. Ltd.—a multinational company that provides shipbuilding, construction, and plant services in South Korea and internationally.
Hanjin Philippines became the biggest employer among all registered businesses in the Subic Bay Freeport Zone with some 30,000 employees during its peak, and was recognized by both the Philippine Exporter Foundation (Philexport) and the Department of Trade and Industry as top export performer, according to SBMA.
Source: GMA News
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