Hanjin Sale Is Possible, Court Says

SEOUL—The South Korean bankruptcy court handling the insolvency proceedings of Hanjin Shipping Co. said Wednesday a sale of the troubled company is possible.

"The sale of Hanjin is one of the options we're considering. If we conclude that it's the best way to rehabilitate the company, we'll do so," Choi Ung-young, a judge and a spokesman for the Seoul Central District Court, said.

Mr. Choi said the court will make a decision soon, as the value of Hanjin's ships and its business network could deteriorate with the passage of time.

Maersk Line, the world's largest container operator and a unit of Danish conglomerate A.P. Mø ller-Mæ rsk, has indicated it plans to buy smaller competitors in the future, fanning market speculation that Hanjin could be an acquisition target.

Hanjin Shipping, the country's biggest operator and the world's seventh largest in terms of capacity, filed for bankruptcy protection last month and is under court order to sell its own ships and returning chartered ships to their owners.

The company has a total of 97 container ships. Of that total, 60 were chartered and 37 owned by Hanjin.

Hanjin's Korean peer Hyundai Merchant Marine Co. will be the first to look at Hanjin's 37 container vessels. Government officials have said they would back Hyundai in buying Hanjin assets, provided such a move would help it stay competitive. Hyundai Merchant, which is itself in the midst of a creditor-led restructuring program, said it is exploring all possibilities with Hanjin but nothing has been decided.

Shares of Hanjin have risen 40% in the past week after Maersk Chief Executive Sø ren Skou said acquisitions are "the preferred option" of Maersk investment, instead of building new vessels.

Hanjin officials and Mr. Choi, the court judge, said Wednesday they haven't been approached by Maersk over a possible takeover of the company.

Analysts said Maersk would be more interested in buying Hanjin's vessels rather than the entire company.

Seoul's maritime minister, Kim Young-suk, said Tuesday he believes Hanjin's corporate value as a going concern is higher than if it liquidated, although the company's fate is up to the court.

Write to In-Soo Nam at [e-mail]

(END) Dow Jones Newswires

September 28, 2016 05:45 ET (09:45 GMT)

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