South Korea's STX Group mulls selling European shipyards

SEOUL - Agance France-Presse

AFP Photo

South Korea's troubled shipbuilding and shipping conglomerate STX Group is considering selling its European assets including its shipyards in France and Finland, a spokesman said Saturday.
 
The group has seen its major affiliates reel under mounting debt as it was hit by a global downturn in the shipbuilding and shipping sectors.
 
"We are now in the process of rearranging the corporate structure to focus on domestic shipbuilding. In this context, we are considering the sale of overseas assets to raise fresh liquidity," the company spokesman said.
 
These assets include shipyards in the European Union and China, he said.
 
"Some potential buyers have already shown interest" in buying stakes in the European shipyard, he said, adding it was not yet decided whether the group would sell all or part of its stakes in such overseas affiliates.
 
"The picture will become clear in the second half of this year," he said.
 
Under the wing of its holding company, STX Corp., the group is composed of 11 subsidiaries including its flagship STX Offshore & Shipbuilding Co. Ltd., STX Pan Ocean, STX Heavy Industries and STX Engine.
 
STX Group has been seeking to sell units and affiliates to try to secure cash as more than a trillion won ($911 million) in corporate debt matures this year, according to its main lender Korea Development Bank.
 
Its European assets include shipbuilders STX Finland and STX France, which is two-thirds owned by STX Europe, a subsidiary of STX Shipbuilding. The other third of STX France is owned by the French state.
 
STX France operates two shipyards, one in Saint-Nazaire and the other one in Lorient, while the Finnish operations include three shipyards in Turku, Rauma and Helsinki.
 
In December the Saint-Nazaire yard -- which has struggled to secure major new orders in recent years -- won a lifeline with a billion-euro deal to build a luxury liner for Miami-based Royal Caribbean International.
 
The yard employs 2,100 people, and provides work for another 4,000 sub-contractors. It built the transatlantic liners Normandie in 1935 and France in 1960 and the Queen Mary 2 in 2002.
 
On Friday cash-strapped STX Group said it aimed to raise around $360 million by selling a controlling stake in its affiliate STX Energy Co. to Seoul-based private equity firm Hahn & Company.
 
The conglomerate pledged late last year to raise 2.5 trillion won by selling assets, and has since raised 1.13 trillion won.