Asian Equities Analyst, Logistics & Transport, Tracking Traffic

Daniel Hellberg

Focusing on Asian logistics, transportation, and travel companies

Asian Equities Analyst, Logistics & Transport

Equity Bottom-Up

Several things have happened in the <a href="https://www.smartkarma.com/entities/18689" target="_blank" data-smartkarma-citation="entities:18689:1">Hanjin Shipping Co Ltd (117930 KS)</a> bankruptcy case since our last update about three weeks ago (see <a href="https://www.smartkarma.com/insights/hanjin-shipping-aftermath-which-carriers-are-most-stressed-and-what-s-next-for-the-sector" target="_blank" data-smartkarma-citation="insights:5784">Hanjin Shipping Aftermath: Which Carriers Are Most Stressed? And What’s Next For The Sector?</a>). In recent weeks:<ul><li>Hanjin has obtained some short-term loans, but it needs more, and soon</li><li>Spot container rates rose sharply in early September, but recently fell back towards earth</li><li>Speculation has grown that another carrier will buy Hanjin, but we view a takeover as unlikely</li><li>Finally, Hanjin's share price has risen by 30% from its September low of 895 KRW per share, giving it market capitalization of about US$258 mn as of Friday, September 30th</li></ul>In this note we update investors with our interpretations of these recent developments, and give special attention to what a potential acquirer would hope to gain in purchasing some or all of Hanjin's assets. Lastly, we offer our views on the likelihood of a Hanjin sale and a rough outline of how we expect events to play out over the next six months.We remain negative on prospects for a medium-term recovery in container shipping, and we believe observers overestimate the attractiveness of most of Hanjin's assets.

Several things have happened in the Hanjin Shipping Co Ltd (117930 KS) bankruptcy case since our last update about three weeks ago (see Hanjin Shipping Aftermath: Which Carriers Are Most Stressed? And What’s Next For The Sector?). In recent weeks:Hanjin has obtained some short-term loans, but it needs more, and soonSpot container rates rose sharply in early September, but recently fell back towards earthSpeculation has grown that another carrier will buy Hanjin, but we view a takeover as unlikelyFinally, Hanjin's share price has risen by 30% from its September low of 895 KRW per share, giving it market capitalization of about US$258 mn as of Friday, September 30thIn this note we update investors with our interpretations of these recent developments, and give special attention to what a potential acquirer would hope to gain in purchasing some or all of Hanjin's assets. Lastly, we offer our views on the likelihood of a Hanjin sale and a rough outline of how we expect events to play out over the next six months.We remain negative on prospects for a medium-term recovery in container shipping, and we believe observers overestimate the attractiveness of most of Hanjin's assets. 

Hanjin Shipping: Update & What Would a Potential Acquirer Actually Get?