Seoul Central District Court ruled on 3 August to start rehabilitation proceedings for Korean shipping company Samsun Logix.
Hur Hyun-Chul, a former Samsun Logix CEO, has been appointed as the company’s custodian as it tries to work out its debts, largely to Korea Line Corporation (KLC).
In a dispute over the charter of Greek owner Carras Hellas’ Capesize bulker Aquadiva, Samsun Logix owes KLC USD57.4 million.
In March 2012, KLC sub-chartered Aquadiva to Samsun Logix for USD33,500 per day, but the arrangement was terminated in November that year when Samsun Logix failed to make agreed payments.
Carras Hellas, which had fixed Aquadiva to KLC at a daily rate of USD28,000 for 10 years, sought arbitration over missed payments from KLC. On 6 May 2015 the London Maritime Arbitrators Association (LMAA) ordered KLC to pay the Greek owner USD37.6 million.
KLC then went through LMAA to seek compensation from Samsun Logix. On 30 July, the association ordered Samsun Logix to pay KLC USD57.4 million, prompting it to seek the Korean court’s assistance in getting its finances back on track.
Seoul District Central Court has given Samsun Logix until 24 August 2015 to submit its list of creditors, shareholders, and mortgagees.
From 25 August to 14 September, creditors may register their claims, which will be verified from 15 September to 5 October.
Hur will meet all interested parties and creditors in court on 30 October, while Samsun Logix has until 21 December to submit a rehabilitation plan.
In March 2009, at the peak of the financial crisis, Samsun Logix had earlier turned to the courts for bankruptcy protection after accumulating USD1.2 billion in debt through taking ships on long-term charter at peak rates.
Under the rehabilitation plan then, Samsun Logix was ordered to repay KRW81.7 billion (USD70 million) to secured creditors and KRW 601.4 billion to unsecured ones through to 2019.
In 2010 and 2011, Samsun Logix repaid KRW 114.3 billion and KRW 28.6 billion, respectively, resulting in an early termination of rehabilitation proceedings in May 2011.
KLC had entered receivership in 2011 but left rehabilitation following a takeover in 2013 by a TK Chemical-led consortium.