The government will help Korean-owned shipbuilder Hanjin Heavy Industries and Construction Co. Philippines seek fresh funding, a Cabinet official said, with two Chinese companies said to be interested in taking over the insolvent firm.
“With or without Hanjin , we are continously looking for new investors,” Trade Secretary Ramon Lopez said in a press conference on Friday.
“[T]his problem … [can become] an opportunity or an entry strategy. Rather than a fresh investment, it could be a takeover of an existing operation. It adds ways of possibly entering the country,” he added.
Hanjin, the biggest foreign investor in the Subic Bay Freeport Zone, filed for voluntary rehabilitation on Tuesday. It reportedly owes around P412 million to five major Philippine banks on top of another $900 million due creditors in South Korea.
Lopez said that while the matter remains a corporate issue, the government would try “to lure” investors into looking at opportunities.
“We will assist the possible investor to be the one taking over. First objective is to look for another shipbuilder that will take over,” he said.
Trade Undersecretary and Board of Investments (BOI) managing Head Ceferino Rodolfo said two Chinese firms looking for shipbuilding opportunities in the Philippines had expressed interest in Hanjin.
“There’s a lot of interest in the Philippines in terms of ship building industry. For the past two days we have gotten in touch with some investors who visited here, we told them the situation and they are really interested [in Hanjin],” he said.
“But [even] before this happened, two companies from China already expressed their interest set to visit the Philippines and look into the country’s ship building industry,” he added.
”[T]hey texted me and they want to know how much is the assets, who owns these assets, what is the status of the shipyard and who can assist them, if it’s BOI or SBMA (Subic Bay Metropolitan Authority).”
Rodolfo said he went to Subic on Wednesday to personally talk to Hanjin officials.
“They asked us to help them find new investors. The total cumulative investment of Hanjin in that shipyard is $2.6 billion … they (the new investors) can pay the debt then take over the facility, the operations … plus you would probably need about $12 million per month in working capital,” he said.
“We are helping them (Hanjin) because of employment [issues]. This is an opportunity because you have 100,000 … workers trained by Hanjin,” Rodolfo added.
“We … have a capability for ship building. We see this as cash flow problem specific to a company so this really presents an opportunity for other investors to come in.”
Anna Leah E. Gonzales