Hanjin Shipping announced Wednesday a decision by the board of directors to divide the company into a holding company, Hanjin Shipping Holdings Co., Ltd., and an operating company, Hanjin Shipping Co., Ltd.
The South Korean company said Hanjin Shipping Holdings will concentrate on managing the subsidiaries, while Hanjin Shipping Co. will maintain full control over the existing shipping business.
“While showing continued growth and stabilizing its financial structure through its container shipping and bulk shipping business, Hanjin Shipping has come to understand the need of implementing an advanced corporate governance system which will allow the company to cope with the rapidly changing business environment and secure its future-oriented corporate structure for sustainable growth,” the company said in its announcement.
“The transformation into a holding company will accommodate Hanjin Shipping with the tools necessary to ensure an independent business operation and corporate transparency,” it said.
It added that it expects the transformation into a holding company to allow its subsidiaries to focus on the core business through an independent strategy and distribution of its business resources. “Moreover, the separation of the investment and corporate governance function from the main shipping business is expected to strengthen risk management capacity.”
The stocks of Hanjin Shipping Holdings and Hanjin Shipping will be distributed to the shareholders according to the ratio of net asset of each company. The stockholders with 1 share of the former Hanjin Shipping will be given 0.1616362 shares of Hanjin Shipping Holdings and 0.8383638 share of new Hanjin Shipping. The face value per share will remain the same. After the official separation on Dec. 1, the companies will be re-listed on Dec. 29.
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