The South Korean court which ishandling STX Offshore & Shipbuilding Co. bankruptcy proceedings said Friday, November 4, it had received bids from 4 foreign shipbuilders for the shipyard and its profitable French unit making cruise ships, and hoped to see a deal concluded by the end of 2016.
The four will now undertake due diligence of STX’s assets for up to two weeks before offering final takeover proposals, according to a judge and spokesman for the Seoul Central District Court, which is handling the case.
The judge declined to identify the bidders, or clarify precisely which assets they had bid for. The court said last month buyers would have the choice of purchasing STX Offshore and the French unit separately or as a package.
But the judge did say the court hasn’t received a bid from any Korean shipbuilder.
Creditors and bondholders of STX Offshore will meet Nov. 11 to decide on the company’s debt restructuring plan. If the plan is rejected, the firm will be liquidated.
The sale of STX France is a key part of the restructuring plan by STX—Korea’s fourth largest shipbuilder—which filed for receivership in May and owns two-thirds of the French unit.
Italian shipbuilding giant Fincantieri SpA and Dutch counterpart Damen Shipyards Group are in the running to buy STX France, a person with direct knowledge of the matter told The Wall Street Journal in September.
The Seoul Economic Daily, citing industry sources, said the bidders for STX France also include French state-controlled naval shipbuilder DCNS as well as Fincantieri and Damen.
Officials at the European shipbuilders couldn’t be reached for comment.
Creditors have pumped in billions of dollars to bail out STX Offshore, but it still ran up a 314 billion won (nearly $280 million) operating loss last year, following a 1.5 trillion won loss in 2014. The company owes financial institutions nearly 6 trillion won.
Korea is home to the world’s three largest shipyards: Hyundai Heavy Industries Co., Daewoo Shipbuilding & Marine Engineering Co. and Samsung Heavy Industries Co. All three are undergoing corporate overhauls that include layoffs and the sale of noncore assets, after being buffeted by shrinking orders amid weak freight rates and competition from lower-cost Chinese rivals.