By Joyce Lee

SEOUL, Sept 21 (Reuters)– The biggest investor of Hanjin Shipping Ltd settled on Wednesday to offer 60 billion won ($ 53.96 million) to aid discharge freight that has actually been stranded because the globe’s seventh-largest container provider fell down late last month.

Korean Air Lines stated it would certainly make the formerly vowed finance making use of Hanjin’s receivables as security, also as media records stated the South Korean court handling Hanjin’s receivership questioned its capability to endure a restructuring.

The airline company’s finance remains in enhancement to 40 billion won given by the Hanjin Group’s chairman, yet the total amount is still except the 173 billion won Hanjin approximated in a court entry this month that it required to discharge all freight.

A rehab prepare for Hanjin is “realistically impossible” if leading concern financial debt such as backlogged charter costs go beyond 1 trillion won, the Seoul Central District Court stated, the Yonhap News Agency reported on Wednesday.

Korean Air Lines did not state when the funds for discharging would certainly be paid out. It had actually revealed the finance previously this month yet had actually not had the ability to get to arrangement on security.

Hanjin should send a recovery strategy to the court in December.

Hanjin has actually started returning legal vessels to their proprietors and also had actually been attempting to protect funds to aid discharge ships. An approximated $14 billion of freight was originally entraped on its ships worldwide, developing mayhem in advance of the critical vacation purchasing period.

Some 13 Hanjin container ships were waiting in global waters outside Busan port, according to most recent Hanjin information, as South Korea’s biggest port had a hard time to fit vessels rejected access somewhere else and also compelled to cruise residence.

“It’s a highly abnormal situation. Time is money for a shipper, so the more ships wait, the more losses,” a Busan Port Authority spokesperson stated. “Some ships are waiting because they cannot leave for their destination.”

At the Hanjin Newport area of Busan port, 78.6 percent of container capability was loaded since Wednesday early morning, greater than the 60 percent liked for effective procedure, the port spokesperson stated. Of regarding 33,000 containers at Hanjin Newport, regarding 40 percent held freight.

Busan is just one of a handful of significant international ports where Hanjin ships can openly discharge freight without risk from financial institutions. South Korea’s maritime ministry stated previously this month that Busan and also Incheon port authorities will certainly assure repayments for a lot of solutions used to Hanjin Shipping vessels.

Hanjin was given remain orders to secure its ships from seizure in South Korea, the United States, Japan, Britain and also provisionally Singapore previously this month, and also is looking for remain orders somewhere else. However, loads of ships continue to be secured off ports while Hanjin attempts to protect funds to discharge freight.

REDUCING FLEET

With financial debt of regarding 6 trillion won ($ 5.4 billion) at the end of June and also the South Korean federal government’s hesitation to place a rescue, assumptions are reduced that Hanjin Shipping will certainly endure.

Top top priority financial debt implies insurance claims for public rate of interests, which are paid initially to financial institutions and also consist of freight proprietors’ problems and also unsettled charter costs, Yonhap reported, mentioning the Seoul Central District Court.

Backlogged charter costs that happened after Hanjin Shipping’s court receivership have actually covered 40 billion won, while freight proprietors’ insurance claims for problems are anticipated to start in earnest after 3-4 weeks have actually passed from initial shipment routines, the record stated.

Court authorities were not right away offered for remark.

Shares in Hanjin come by greater than a 5th to a document reduced after the court remarks were reported, which backed up to the sight the business will certainly glide right into liquidation. Shares of opponent Hyundai Merchant Marine Co Ltd (HMM) climbed 16 percent to a close to 2-week high.

On Wednesday, HMM stated it would certainly include a vessel on the Busan to Europe path beginningSept 29 to relieve the capability capture triggered by Hanjin’s collapse.

“HMM is the only national shipping company left to take care of what Hanjin Shipping was in charge of for now,” stated Cho Byung- hyun, an expert at Yuanta Securities Korea.

“The market is expecting HMM to take back Hanjin’s pie from the industry though there is still some possibility that shipping companies from China, Taiwan, or Hong Kong would come in.”

($ 1 = 1,111.9300 won)

( c) Copyright Thomson Reuters 2016.