DSME escapes debt workout program

The Daewoo Shipbuilding and Marine Engineering Co. (DSME) is expected to be the first Daewoo subsidiary to be released from a group debt workout program.

The Korea Development Bank, the main creditor bank for the DSME unveiled on August 19 that it will determine whether to finish the workout program or not in a committee meeting on August 20, then ask for paper-approval from other credit banks.

By this, the KDB predicted that they may drive for a final decision before August 25, after reviewing credit evaluations from other crditor banks.

After finishing the workout program that it has been under since August 1999, it expects its corporate image to improve.

In the mean time, the KDB said that in the working level creditors meeting on August 13, creditors unanimously reached an agreement to finish the debt workout program for the DSME.

The creditors predicted that as net profits for the DSME during the first half this year surpassed 100 billion won and ordinary profits also went over 150 billion won, the DSME will close out of the workout program quietly.

If it is freed from the workout program, the maturity of its 500 to 600 billion won in workout loans will be shortened from 20 years and the interest rates will be stepped down to normal rates.