Daewoo Logistics files for receivership

SOUTH Korea’s Daewoo Logistics has filed for receivership in the Seoul District Court, according to market reports.

Daewoo Logistics entered the marine field in 2004 was known to be in financial difficulties but had expressed hopes of it continuing business as a Posco acquisition.

Posco, South Korea’s largest steel mill, said in May it was in the market for a shipping company to help it secure stable supplies of raw materials.

The company said it was eyeing a plan to buy Daewoo Logistics, which, as part of its core operations, runs a fleet of bulk carriers.

At the time a spokesman for Posco said nothing had been decided and that the plan was at the initial stages. Nobody at Posco was available for comment this evening Korea time.

Despite the recent collapse in raw material prices, Posco’s Won4trn ($3bn) cash pile is one of the largest among the top Korean companies.

By contrast, Daewoo Logistics had been sailing a sea of adversity over the last year. The logistics and resources development company sustained a loss of Won14.8bn in 2008 as the impact of the global economic slump and falling freight rates combined to slash margins.

Earlier this year Daewoo Logistics’ $6bn deal to own 1.3m ha of prime agricultural land in Madagascar fell thorough after a military coup, leaving it with little hope of compensation.

Phone calls to Daewoo Logistics went unanswered today.