HMM seeks to acquire parts of SK Shipping for $1.4 bn from Hahn & Co.

HMM Co., South Korea’s largest ocean carrier, is seeking to buy SK Shipping Co., excluding its liquefied natural gas (LNG) transportation business, for an estimated 2 trillion won ($1.4 billion), investment banking industry sources said on Thursday.

HMM is conducting due diligence to acquire SK Shipping’s tanker, liquefied petroleum gas (LPG) carrier, bulk cargo and other businesses from its top shareholder Hahn & Co., the sources said.

Morgan Stanley is managing the sale.

HMM is not allowed to make an offer on the LNG tanker service until 2029 due to an agreement not to enter that business when the company sold it in 2014.

ACQUISITION PLAN TO GO TO BOARD AS EARLY AS APRIL

The flagship sea carrier is considering taking over all of SK Shipping’s business except the LNG carrier division, although it has yet to make a final decision.

HMM plans to complete due diligence by next month and propose the acquisition to its board of directors as early as April.

SK Shipping, the country's No. 1 tanker and dry bulker operator, is known to have the most stable revenue structure among local shipping companies, industry sources said.

Hahn & Co. bought an 83.65% stake in SK Shipping in 2018 from the country’s second-largest conglomerate SK Group, which sold the company to avoid tunneling regulations.

Write to Jong-Kwan Park and Jun-Ho Cha at pjk@hankyung.com
 

Jongwoo Cheon edited this article.