South Korean boxship owner SM Line has returned to profit in the third quarter and launched a bid to take over compatriot shipbuilder Hanjin Heavy Industries & Construction.
Three consortia are in the running for the Busan yard, main creditor Korea Development Bank has revealed. One is led by SM Line and another by construction company Dongbu Corp.
An 83.45% stake in Hanjin Heavy owned by seven domestic banks and three Philippines lenders is up for grabs.
The Yonhap news agency reported that unionised workers at Hanjin Heavy have called for job security and a ban on turning the plant into flats.
However, the South Korean government wants Hanjin Heavy to turn to military shipbuilding.
The struggling Hanjin Heavy group saw its Philippines yard sold to Australian shipbuilder Austal and US fund Cerberus Capital Management in September.
SM Line was launched in 2018 after South Korean conglomerate Samra Midas Group bought assets from defunct Hanjin Shipping, once the country’s largest container lines.
The owner operates 19 boxships of up to 8,600 teu, plus a bulker.
Back in the black
SM Line reported a net profit of KRW 30.2bn ($27.6m) in the third quarter, turning around an operating loss in 2019, according to Alphaliner.
Revenue was KRW 219bn, while operating earnings reached KRW 40.4bn, against a loss of KRW 3.9bn a year ago.
The transpacific specialist expects a further improvement in the fourth quarter.
Earlier this year, the company signed a space-sharing deal with 2M Alliance partners Maersk and Mediterranean Shipping Co to replace South Korean rival HMM.
The agreement covers slot exchanges and slot purchases on six services from California and the Pacific north-west.
