South Korean bulker operator Pan Ocean is to raise KRW850 billion (USD785 million) through the issuance of 340 million shares in a paid-in capital increase.
The shares, worth KRW2,500 each, would be bought by Cheil Holdings and Poseidon2014, which would take 272 million shares and 68 million shares respectively.
This was unveiled in a revised rehabilitation plan, which was submitted to the Seoul Central District Court on 21 April.
The company, once South Korea’s biggest dry bulk player, went into receivership in June 2013 after incurring more than USD5 billion in debts but will be acquired by poultry processor Harim Group this year.
The plan, which was posted on the Korea Exchange, revealed that after paying mergers and acquisitions advisers and deducting repaid debts, Pan Ocean has KRW924,773,517,202 (USD853.1 million) available for repayment.
Pan Ocean said it has fully repaid all debts due from secured creditors in 2014 but that in the case of corporate bonds, about 82% of the confirmed claims will be repaid in cash by the due date, and the remaining amount will be waived.
As for bank loans and trade debts, about 82% of these would be repaid by the due date and the remaining amount would be waived.
All of Pan Ocean’s issued shares will be consolidated from 1.25 common shares to one common share with par value of KRW1,000, effectively reducing the number of shares by 20%.
With respect to the amount of claims subject to debt-to-equity conversion including the guarantee claims, contingent subrogation debts and claims filed for the court’s investigatory judgment, one common share with issuing price of KRW12,500 (par value at KRW1,000) will be issued.