The Seoul Central Court declared the final bankruptcy of Hanjin Shipping, the South Korean shipping company that pioneered shipping and ranked as the seventh largest in the world, on Feb. 17, South Korea’s KBS World Radio reported.
The shipping company during its judicial administration process went on to sell some of its main assets, such as its shares on the Long Beach terminal in the United States, among others. Despite these extreme measures, the Court stated that the best option was to liquidate the company, because the recovery will be long and difficult.
Founded in 1977, Hanjin Shipping was South Korea’s first shipping company. It was prosperous until August 2016 when burdened by competition, low freight rates, declining world seaborne trade and charter and creditor debt, filed for bankruptcy and requested to enter into judicial administration.
Since then to date, South Korea’s container transport capacity has been reduced by 59%, reaching only 510,000 TEUs.
The Seoul Central District Court, in South Korea, on February 2, announced its decision to terminate Hanjin Shipping’s judicial administration process initiated on August 31, 2016, giving a two-week appeal period, after which it was liquidated on February 17, according to The Korea Times.
The determination follows a report by Samil PricewaterhouseCoopers (PwC), the company appointed to assess the financial situation of Hanjin. In the report, PwC stated that the settlement value of the shipping company was $1.5 billion.
The final bankruptcy of Hanjin Shipping will involve a massive dismissal of personnel and it is estimated that adding those of related companies or associates, the number of people affected will reach 3,000.