The Korea Shipowners’ Association has hit out at reports the country’s top steel mill is being linked with taking over national flagship, HMM.
Media reported last week that advisors from Samil PwC and Boston Consulting Group have been working with POSCO on feasibility studies for a deal that could be worth in the region of KRW7trn ($5bn), covering the combined 71.7% stake held by state creditors.
State-run Korea Development Bank has been sounding out potential suitors for years. Hyundai Glovis, LX Pantos, and SM Line have all been linked, but none have gained traction . Back in 2021, POSCO’s name was also in the frame, though the then mooted price tag was barely a quarter of today’s.
South Korea’s shipowners’ association issued a statement today, saying HMM — rebuilt at huge taxpayer expense — could “degenerate into a subsidiary for POSCO’s in-house cargo transport” rather than competing with global containerlines. The fear is that if POSCO’s core steel business falters, HMM could again be sacrificed, undoing years of restructuring under the government’s shipping reconstruction plan.
The association flagged three specific risks: first, that container shipping — a highly specialised global business — would suffer from non-professional management; second, that POSCO could use HMM primarily for its own cargo, squeezing out domestic rivals; and third, that this would “collapse the foundation of Korea’s shipping industry” and harm exporters.
Shipowners pointed to POSCO’s failed venture with Geoyang Shipping as evidence of the risks of industrial carriers trying to run shipping lines. They also cited Brazil’s Vale as another cautionary tale.