Nok Bong?s workout collapses

South Korea’s troubled shipyard Nok Bong Shipbuilding’s debt rescheduling procedure has ended on 23 April and it seems to file for court receivership. An official at Shinhan Bank, the shipbuilder’s main creditor, said, “At the creditors meeting held on 23 April, the plan to delay redemption of the shipbuilder’s debt by one month was not passed, failing to secure 75% agreement of the creditors.”

“Accordingly, we notified each creditor of the abortion of the workout program.” He said a foreign shipowner has seized ships under construction at the shipyard worth some $50m and the workout procedure has been facing rough going. Furthermore, creditors have concluded that the shipbuilder’s viability is very low as global shipbuilding industry is now confronted with severe recession, he added.

Nok Bong is said to owe its creditors some KRW 300bn ($224m), and when the creditors collect all securities, their net losses would reportedly come to KRW 100bn.