South Korean bulker outfit Pan Ocean has completed its recovery from financial trouble.
Seoul Central District Court has ratified a clean bill of health for the company – the court approved Pan Ocean’s application for the completion of rehabilitation procedures on 21 July 2015.
The decision comes a day after Kim Hong-guk, chairman of Pan Ocean’s new owner Harim Group, took over as the company‘s co-CEO.
Harim Group, a poultry processor, teamed with private equity player JKL Partners to buy Pan Ocean for over KRW1 trillion (USD865 million) on 9 June.
Pan Ocean went into receivership on 17 June 2013 after racking up over USD5 billion in debts after the dry bulk shipping market collapsed following the global financial crisis.
Related news: Harim Group chairman takes over reins at Pan Ocean
A series of debt-to-equity swaps saw Pan Ocean’s main creditor Korea Development Bank replacing the STX chaebol as the company’s biggest shareholder.
In a Korea Exchange filing on 21 July 2015, Pan Ocean said, “In order to repay our creditors and interested parties early and for our long-term growth and development, we initiated mergers and acquisition and an investment contract was signed with Harim Group & JKL Consortium.”
Accordingly, Pan Ocean executed a revised rehabilitation plan to the court on 12 June, resulting in early repayment of debts on 29 June.
The company said that 91.7% of the restructured debts have been settled, while the amounts, still in arrears, are the result of creditors not declaring their account numbers, unresolved and unconfirmed claims.
Pan Ocean said it is confident of settling all its debts.
The company said, “Considering the company’s assets, liabilities, management condition, it is expected that there would be no difficulties of repayment to the creditors. And, the company considers that it can become a healthy corporation in time to come, thus the completion of rehabilitation procedure has been filed based on the revised rehabilitation plan.”