Daewoo Shipbuilding to sell 790 bln won in new stocks

Daewoo Shipbuilding & Marine Engineering Co., a troubled shipbuilder here, said Tuesday that it plans to sell 793 billion won (US$702 million) worth of new stocks in a bid to strengthen its financial status.

In a regulatory filing, Daewoo Shipbuilding said the new stocks will be sold at 40,350 won apiece to the state-run Korea Development Bank (KDB) and others, including Woori Bank.

The trading of Daewoo Shipbuilding stocks has been suspended since July last year, due to its impaired capital base. Its creditors, including the KDB, are seeking to help resume the trading of Daewoo Shipbuilding on the Seoul bourse this year after dressing up its financial conditions.

In March, the KDB-led creditors announced a fresh rescue package for the ailing shipbuilder that has been suffering from a severe liquidity crunch due to heavy losses in its offshore projects.

Under the lifeline package, Daewoo Shipbuilding gets new loans worth 2.9 trillion won, with lenders and bondholders swapping 2.9 trillion won of debt for new shares in the shipyard.

In return, Daewoo Shipbuilding has pledged to implement self-rescue measures worth 5.3 trillion won through 2018. It has already sold off noncore assets and cut its workforce, through which it has raised or saved 1.8 trillion won.
Source: Yonhap News