Troubled S Korean firm's tanker to be put up for sale

PUBLISHED : Wednesday, 20 July, 2011, 12:00am
UPDATED : Wednesday, 20 July, 2011, 12:00am


An Admiralty judge ordered the appraisal and sale yesterday of a tanker belonging to financially troubled South Korean shipowner Samho Shipping, which has been under arrest in Hong Kong since the end of last month.

The 13,153 deadweight-tonne ship Samho Cordelia is one of three ships owned by Samho Shipping which have been detained in Hong Kong by lawyers acting on behalf of creditors. Ship arrest means the detention of a ship by judicial process to secure a maritime claim. It is not a seizure.

Samho Shipping, which is working on a debt restructuring plan, was badly hurt financially from attacks by Somali pirates on two of its tankers. The company has also been adversely affected by difficulties at a South Korean shipbuilding affiliate.

The shipping company paid a record of US$9.5 million in November of last year to free its 319,360 tonne supertanker Samho Dream, which was hijacked the previous April. The smaller 19,924 tonne Samho Jewellery, with 21 crew members on board, was hijacked by Somali pirates on January 15, but freed by the South Korean military six days later after it boarded the tanker and fought gun battles with the pirates.

Some 24 ships owned by Samho Shipping are thought to be under arrest by creditors worldwide.

Reverend Stephen Miller, senior chaplain at Hong Kong's Mission to Seafarers, said Samho Shipping had its cash flow constrained by the piracy incidents and shipyard problems.

The pastor, who has visited some of the crew on board the Samho ships in Hong Kong, said: 'We are seeing the knock-on effects of piracy.'

The third ship under arrest is the S Nicole, a 77,096 tonne bulk carrier used to haul coal, grain or iron ore.

The Samho Cordelia was arrested by lawyers from Stephenson Harwood on behalf of Singapore's DVB Group Merchant Bank (Asia) over mortgage payments. The bank did not return calls seeking comment.

Mr Justice Anselmo Reyes of the Court of First Instance said the vessel would be appraised to assess its worth and offers would be invited by public tender. Independent shipbrokers estimated the tanker's value at US$23 million.