News / Harim would submit new bid if HMM came up for sale again

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The chairman of Korea’s Harim Group has confirmed it would submit a new bid for HMM if the carrier was put up for sale again, according to Alphaliner today.

State-owned Korea Development Bank (KDB) and Korea Ocean Business Corp (KOBC) retained majority control of the carrier after the sale of their combined 57.9% stake in HMM to Harim fell through in February.

Harim and private equity fund JKL Partners had offered $4.9bn and were confirmed as HMM’s preferred bidder, but KDB and KOBC said: “During the seven-week negotiation period, we worked diligently on mutual trust, but the negotiations ultimately broke down due to differences of opinion on some issues.”

Alphaliner reported that Harim had walked away from the deal after “rejecting the terms offered by the government sellers, who had demanded a strict lock-up period”.

However, Harim chairman Kim Hong-kuk has now confirmed that the group would review a deal if the opportunity arose again. But he has, reportedly, questioned whether the government was “sincere” about selling to the private sector.

“If that was true, the transaction should’ve gone through last time,” he was quoted by Alphaliner.

In June, KDB chief Kang Seog-hoon said there was no intention to resume a bidding process, adding: “If the sale begins anew, we will need to come up with a new plan based on various factors, including the government’s policy for the shipping industry, but I doubt it will come anytime soon.”

Alphaliner analysts said in today’s weekly research note: “Since the failure of the sale in February, there have been various conflicting messages from the Korean government. In March, Korean minister of oceans and fisheries Kang Do-hyung said the ministry had been in discussions with relevant authorities regarding restarting the sale process.”

HMM is South Korea’s largest container carrier and is the eighth-biggest in the world. According to Alphaliner data, it has a fleet capacity of just over 880,000 teu across 79 ships, 54 of which it owns. Also, it has 12 vessels on order, for 110,000 teu, which would boost its current fleet capacity by 12.4%.