The Korean government has said that, should Hyundai Merchant Marine (HMM) and Hanjin Shipping normalise their management, it will consider merging the two largest Korean shipping lines, according to The Korea Times.
Yim Jong-yong, Chairman of the Financial Services Commission, said: “Once the normalisation program for the two shipping companies is wrapped up, the government will consider various plans including the merger of the companies. HMM's normalisation effort has turned the corner, though the company still faces tasks such as joining the alliance. Hanjin's process is in an infant stage and creditors are doing their utmost to assist its self-rescue efforts.”
This announcement follows news that HMM could secure entry into THE Alliance as a result of its plan to order mega-ships.
HMM recently announced that it had recently secured lower charter rates from ship-owners which would enable it to alleviate its debt loads and purchase mega-ships, according to JOC.com.
HMM previously stated that entry into THE Alliance had been postponed because it “might be under court receivership.”
The two lines expressed an interest to pair up with other alliances, with Hanjin having been in talks with alliance members for a potential pair up.
Both carriers have been struggling with poor financial performance for some time, and HMM had recently announced that it was looking to confirm self-rescue measures from its competitors.