Bidding to take over South Korea’s flagship shipowner HMM has come down to two competing groups.
Business Korea cited investment banking sources as saying the race for the boxship, VLCC and bulker company has narrowed to Dongwon Group and a consortium comprising Harim Group and JKL Partners.
Offers have been submitted in a process witnessed by HMM’s big state-owned shareholders, Korea Development Bank (KDB) and Korea Ocean Business Corp.
LX International was initially included on a shortlist of qualified candidates, but decided to withdraw, sources said.
The aim is to select a preferred bidder by the end of November.
Industry observers believe a deal could be signed before 2024.
Previous estimates of the price tag were KRW 5 trn ($3.8bn), but this could have risen to KRW 6.1trn based on a stock price of KRW 15,300.
At the end of June, Harim and Dongwon were said to have cash assets of about KRW 1.6 trn and KRW 500bn, respectively.
Major fundraising efforts will have to take place for either to meet the cost.
KDB said in a statement: “The primary bidding for HMM has resulted in effective competition.
Big names drop out
“While the selection of a preferred bidder typically takes one to two weeks, we plan to expedite the signing of the stock purchase agreement by reaching an agreement with relevant authorities as quickly as possible, aiming to conclude it within the year.”
German container ship owner Hapag-Lloyd was said to be in the running at one point.
SM Group, the parent company of SM Line, Korea Shipping Corp, Korea Line Corp and TK Chemical Corp, had also been expected to bid.
KDB has to assess the eligibility of the bidders by evaluating their ability to operate a national shipping line and to mobilise funds.
VesselsValue lists HMM with 57 ships worth $8.5bn, including 10 VLCCs, as well as ultra-large container ships, an LNG carrier and capesize bulkers.
