Razon plans for Hanjin takeover

Published April 11, 2019, 12:00 AM

by manilabulletin_admin

By James A. Loyola

Gaming and ports tycoon Enrique K. Razon Jr. is drafting a masterplan for his bid to acquire the shipyard facilities of South Korean Hanjin Heavy Industries and Construction Philippines in Subic Bay.

Enrique Razon
ICTSI Chairman Enrique K. Razon Jr.

In an interview at the sidelines of the annual stockholders’ meeting of International Container Terminal Services, Inc., Razon said that they are still presenting to creditor banks their for taking over the facilities.

Razon was earlier reported as a possible buyer of Hanjin’s facilities which could be useful for conversion into an industrial complex with container port facilities, a liquefied natural gas terminal, dry bulk handling facilities and agricultural support handling. However, he ruled out putting up another port facility in the area or maintaining it as a shipyard.

“It’s a very large facility, so it will be several (facilities). The problem is the road is not really good. It’s okay for shipbuilding because they are only there but for other things the road is the problem,” Razon said.

Building a road wide enough for the container trucks to pass may not be feasible as they need several clearances from the local government unit.

He noted that they cannot build another port as it will compete directly with Manila, where its flagship container port is located and there are already two terminals in Subic Bay that ICTSI also operates.

“The (port) capacity can be as big as you want, but is there enough volume to build that up,” he said.

Razon noted though that “the Philippines is not really competitive in this area (shipbuilding), nothing that the shipyard uses is made in the Philippines, unlike Japan China and Korea, they make the steel, the machinery, all of that.”

Razon said his team is “constantly talking” with creditor banks, which would need to dispose of the Hanjin’s assets and not run the shipyard themselves.

“If it doesn’t work for us, we’re not going to do it,” he said.

In January this year, Hanjin filed for corporate rehabilitation before an Olongapo City Regional Trial Court after it defaulted on its loans.

Hanjin owes local banks some $412 million, and another $700 million from overseas creditors mainly from Korea Development Bank of some $100 million and from its parent South Korean firm Hanjin Heavy Industries.