Samsun Logix files for bankruptcy protection again

The West of England P&I club in notice to members quoted law firm Kwon & Moon as saying that Samsun Logix Corp had filed for debt rehabilitation proceedings in the Seoul Central District Court on 3 July.

“The court will shortly issue an interim preservation order which prohibits Samsun from disposing of its assets, making payments for existing debts or borrowing money without court approval.  This means that Samsun cannot pay future hire without court approval,” the notice said.

“Further, the court will also issue a comprehensive stay order on judicial proceedings against Samsun.  This means that creditors cannot enforce their claim against Samsun’s assets in Korea.  In case where a foreign court recognizes the order of the Korean court, enforcement against any assets of Samsun in the foreign country will be also prohibited.”

It is the second time that Samsun Logix has filed for bankruptcy protection, the previous time being March 2009 after the dry bulk shipping market crashed following the onset of the global financial crisis.

The court is expected to decide if rehabilitation will commence with the next two weeks, and the law firm noted it was not certain the court would grant rehabilitation -proceedings given it is the second time the company has filed for bankruptcy protection.

According to VesselsValue.com Samsun Logix has a fleet of seven dry bulk carriers with a combined value of $47.64m. The fleet comprise three capesizes, two panamaxes and two handy bulkers.

Samsun Logix joins fellow South Korean dry bulk shipping Daebo International Shipping, and China’s Winland Ocean Shipping and Denmark’s Copenship in seeking bankruptcy protection this year.

Key dry bulk shipping market indicator the Baltic Dry Index, averaged just 576 points in the first five months of the year, but has recovered somewhat since and closed yesterday at 830 points.