Korean shipbuilder’s main bondholder ends weeks of wrangling to back rescheduling plans.
DSME’s main bondholder, South Korea’s National Pension Service (NPS), has finally given its backing to efforts to keep the struggling shipbuilder afloat.
It has agreed to the debt rescheduling measures proposed by the state-run Korea Development Bank (KDB) led creditors, reports the Yonhap news agency.
”Accepting the debt restructuring will be more advantageous to improve the fund’s returns,” NPS, the world’s third-largest pension fund, said in a statement earlier on Monday, according to Reuters.
The decision by NPS, which owns around 30% of DSME’s bonds, paves the way for the troubled shipbuilder’s other bondholders to approve the plan.
Support at the first two of five bondholder meetings has been considerable, with 99.99% of bondholders offering agreement at the first meeting and 98.99% at the second, Reuters says.
“Immediate concerns have been resolved and this is good,” Kim Ki-myung, a credit analyst at Korea Investment & Securities told Bloomberg.
“Daewoo Ship will live and can get back to concentrating more on its day-to-day efforts to turn itself around rather than scrambling to meet its upcoming debt obligations.”
Yonhap said the pension fund had been in drawn-out talks with main creditor banks to discuss ways to keep the shipyard.
DSME bondholders are holding two days of meetings this week to decide on whether to accept the debt rescheduling scheme.
Yonhap said investors who hold some KRW 300bn ($264m) worth of DSME bonds approved the debt rescheduling plan earlier on Monday.
Bondholders with some KRW 800bn of DSME bonds should decide on the debt rescheduling by Tuesday, the news agency added.
Last month South Korea unveiled a $2.6bn rescue package for the yard, backed by state lenders Korea Development Bank and Export-Import Bank of Korea (Kexim).
