South Korean shipbuilder C&Heavy Industries had signed a non-binding agreement for its sale to an unidentified Malaysian company.
Distressed South Korean shipbuilder C&Heavy Industries said on Tuesday it had signed a non-binding agreement for its sale to an unidentified Malaysian company. Local banks had ended a creditor-led rehabilitation programme for C&Heavy, a unit of C&Group, after the company failed to find a buyer by mid-March. In a filing to the Korea Exchange, C&Heavy said a possible deal would see the entire company or part of its businesses being sold. It did not name the potential buyer citing confidentiality.
The shipbuilding industry is suffering from lack of new orders and overcapacity in the global recession.
While top players such as Hyundai Heavy Industries and Daewoo Shipbuilding are holding up on order backlogs, smaller companies which had expanded business in the last few years were directly hit.
C&Heavy was earlier singled out for restructuring by domestic banks which assessed credit risks of struggling firms.
Lazard Asia and Mirae Asset Securities are handling the sale of C&Heavy.