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Korean Air will give $58.9 million loan to Hanjin Shipping

Staff Writer |
Korean Air Lines, the largest shareholder of Hanjin Shipping, decided Wednesday to provide 60 billion won ($58.9 million) to the cash-strapped shipper.




The decision came at a meeting of the Korean Air board of directors, which earlier refused to help out the troubled affiliate, citing fears of misappropriation charges as the container shipping line had little to offer in collateral.

The 60 billion won will be injected based on accounts receivable, according to Korean Air officials.

The amount will make up the 100 billion won emergency fund earlier pledged by Hanjin Group, the parent company of Hanjin Shipping.

The remaining 40 billion won will come from the personal accounts of Group Chairman Cho Yang-ho, part of which have already been injected to bail out a number of Hanjin ships stranded at sea out of fears of being seized by overseas creditors.

Hanjin entered court receivership earlier in the month after its creditors rejected the company's 500-billion-won self-rescue plan.

The company has been ordered by the court to submit a self-rehabilitation plan by Nov. 25.


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