Thursday, August 22nd, 2013
The main reason for the state-run bank's willingness to provide additional loans to the struggling shipper is that the company needs a certain amount of working capital to get back on its feet and improve its corporate value. There is no need for the company to pay back its debts as long as it is under a corporate workout program. But some other payment obligations like unpaid wages or debts from bareboat charter hire purchase agreements must be paid back before the commencement of a corporate workout program.
An official from Korea Development Bank said, "As STX Pan Ocean commissioned 59 vessels to STX Offshore & Shipbuilding for the 2008-2012 period, it must pay back the bill between 2013 and 2017. As the company must pay bills quickly but get revenue for years to come, it is likely to suffer a liquidity problem. That's why we need to lend the money for its working capital needs."