The state-run Korea Development Bank (KDB) said Thursday it plans to sell the European arm of STX Group as part of efforts to quicken the ongoing restructuring process of the financially troubled conglomerate.
The largest creditor bank of South Korea's 13th-biggest conglomerate said it is preparing to sell STX Europe AS, although no detailed plans as to the scale of or means to carry it out have been decided yet, according to a KDB official with knowledge on the matter.
STX Group, the shipping and shipbuilding giant, has seen its major affiliates struggling from liquidity shortages and mounting debt due to the downturn in its main business sectors.
In April, STX Offshore & Shipbuilding requested that the creditors supply liquidity in exchange for its voluntary debt-relief and restructuring efforts.
The creditors plan to provide fresh liquidity worth about 2.15 trillion won (US$1.99 billion), leading the total volume of liquidity injection to reach nearly 3 trillion won. A debt-to-equity swap worth 700 billion won and capital reduction are also planned.
KDB hopes the sale of STX's European unit will help the cash-strapped firm repay some of its massive debts, the official added.
The creditor bank will soon pick sale managers and draw up strategies for the sale after a thorough assessment on the afiliate.
STX Europe had been previously known as Aker Yards ASA, a Norwegian shipbuilder, before STX Group took over the management in 2008.