HMM to sell LNG transport business

HMM plans to sell the LNG business as part of its KRW 3.3 trillion ‘self-help’ plan presented in December 2013.

A HMM official said: “It’s too bad that we had to sell the LNG business unit, which provided us with sizable profits and stable cash flow. But we’ll focus our ability on enhancing the global competitiveness of our containers and bulk units, and by doing so we’ll be able to become the best shipping company.”

Bidding has begun, with HMM receiving a Letter of Intent (LOI) from six candidates early last month. The deal is expected to be closed in the first half of this year.

HMM owns 10 LNG vessels and is in a long-term charter contract with state-run Korea Gas Corporation until 2028, as part of which it has been transporting 7.3 million tonnes of gas – already 20% of South Korea’s annual LNG consumption.

The company says it expects the sale to help it gain ‘momentum’, which in turn will support its plans to repay debt and secure additional liquidity.