In the midst of the financial problem that Hanjin Heavy Industries and Construction Philippines (HHIC-Phil) is facing now, the government has been exerting efforts to help the embattled South Korean shipbuilder.
In the media interview, Trade Undersecretary Ceferino Rodolfo disclosed last Friday that the government has been looking for foreign investors that would help out Hanjin from its financial turmoil.
HHIC-Phil is dubbed as the most promising investor of Subic Bay Freeport Zone suddenly sought for commercial insolvency due to their cash flow problem that incurred $412 million in loans to five leading domestic banks.
The Trade Official said that as early as October 2018, the government has already been working to help Hanjin in their financial problem. There were already two Chinese firms that expressed their interest in the country’s shipbuilding industry.
When asked by The Philippine Business and News if the young billionaire Dennis Uy of Davao City has shown interest in taking Hanjin Heavy Industries and Construction Philippines to save the latter from their $400 million debts, Rodolfo replied in affirmative but Uy backed out for unknown reason as early as mid-last year when the issue was not been disclosed yet in public.
It was The Philippine Business and News who asked Trade Secretary Ramon Lopez on the implication of Hanjin’s financial problem during the Department of Trade and Industry press conference on 2018 Accomplishment Report and Program Outlook for 2019.
The Trade Chief clarified that issue is a corporate decision (of Hanjin), but as one of the biggest investor Hanjin has been getting all the help they need from the government.
Lopez said, “All the displaced (10,000) employees will be absorbed by the Build, Build, Build program of the Duterte administration since the displaced workers have the skills needed in the construction.”
For his part, Rodolfo also revealed that the displaced employees received a handsome compensation package from Hanjin to make sure that they have something to start up with.
“Those who were retrenched were able to get substantial amount of money. But of course, if the money will not be used wisely, they will all be gone”, Rodolfo added.
As for the interested parties who want to take over Hanjin and free them up in their financial problem, the Trade Official revealed that, “There are initially two Chinese firms who are supposed to meet with him this month and on February and this is somehow a positive development and an opportunity for Hanjin to explore with potential investors”.
The first firm fits well because like Hanjin, they are in the production of commercial vessels, and the other one is just into the manufacture of small ships.
There could have been a joint venture for Hanjin with a Chinese firm earlier, but this was refused because of the quoted price which was way higher than what they just recently quoted based on Hanjin official. Now Hanjin is willing to accept an offer of 500 percent lower.
Meanwhile, The Philippine Business and News is getting the reaction of Subic Bay Metropolitan Authority (SBMA) Chairman Wilma Eisma on what will be their contingency plan and how would it affect the Subic Freeport Zone as an investment hub. But as of this posting, we did not get any reply yet.
But in its previous statement, SBMA chief said that Hanjin does not have enough fund to repay its loans, and continue its operation given their financial condition.
“While Hanjin was very successful in putting the Philippines in the map being the world’s fifth largest ship builder, it is with deep regret to see that their financial crisis unexpectedly happened”, Eisma said.