Creditors of South Korea’s STX Offshore & Shipbuilding Co Ltd yesterday narrowly approved a debt restructuring plan, avoiding the imminent liquidation of what was once the nation’s fourth-largest shipbuilder.
The agreement came a week after the bankruptcy court handling the case said it had received bids from four foreign shipbuilders for the troubled shipyard and its profitable French unit, which makes cruise ships.
Before voting on the restructuring plan, creditors heard a statement from a court-appointed accountant who concluded that STX would be able to raise a total of 1 trillion won (US$860 million) by 2026 through business activities, the sale of non-essential assets and fresh loans.
“The rehabilitation plan is deemed feasible,” the accountant’s statement said.
The vote was extremely close, with creditors holding 66.9 percent of STX’s non-collateralized debt approving the plan — just above the required two-thirds ceiling.
If the plan had been rejected, the firm would have been liquidated.
STX sought a court-led restructuring in May after struggling for years with mounting losses caused by mismanagement and a slump in global demand.
Creditor banks have stumped up billions of dollars to keep the company afloat, but its total debt still stand at about 7 trillion won.
Four foreign firms have submitted bids to buy STX. Local media reports named three as Italian shipbuilder Fincantieri — Cantieri Navali Italiani SpA, Damen Group of the Netherlands and French state-controlled naval shipbuilder DCNS Group.
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