South Korea’s biggest container carrier Hanjin Shipping has applied for a debt restructuring agreement with creditors as its former chairwoman and her two daughters are under investigation for alleged insider trading.
Choi Yoo-kyung and her two daughters are suspected of using inside information while selling their entire stake in Hanjin days before the company announced its decision to file for bank receivership.
The shipping company’s former chair and her two daughters sold their 3.1bn won (US$2.6m) worth stake in Hanjin between April 6 and 20, while the company applied for a creditor-led debt restructuring program to the state-owned Korea Development Bank on April 25.
South Korea’s financial regulator Financial Services Commission (FSC) reported that the creditor group is expected to make a decision on whether to initiate the procedure.
According to the Bloomberg, Hanjin is also planning to raise around 410bn won (US$357m) by selling its stakes in its bulk-shipping and other sections, in addition to some property and brand rights.
The carrier’s South Korean competitor, Hyundai Merchant Marine (HMM), is also trying to strike a deal with creditors.
In order to receive support for business normalisation from creditors, HMM would have to reach an agreement with bondholders to restructure the debt, and with ship owners to lower charter rates.