South Korea’s largest container shipping line, Hanjin Shipping has called for the help of terminal operators and the owners of its chartered fleet to help with its debt restructuring in order to survive in a saturated market, according to the Wall Street Journal.
At the end of 2015, Hanjin’s debt stood at US$5.7 billion.
Min Park, Spokeswoman for Hanjin, said: “Upon careful analysis of the business outlook and financial projections with the assistance of outside experts, our management has come to the conclusion that our own efforts alone may fall short of fully resolving the liquidity issues that we are facing.”
In recent news reported by PTI, Hanjin Shipping, together with its fellow South Korean carrier Hyundai Merchant Marine, were said to be looking into pairing up with other carriers to form an alliance.
This initiative is planned for when its alliance structures expire in 2017.
This follows news that a merger between both carriers would significantly help the two carriers to stay afloat and effectively handle soaring debts.
Many lines have opted into shipping alliances, as well as the order of larger containerships in order to capitalise on economies of scale.
However, this may not be suitable in the long-term, after it was recently reported that the mega size of ships is not delivering on lower costs for shipping lines.