Sungdong Industrial creditors offering gigantic crane in fire-sale price

Sungdong IndustrialThe Korean shipyard may now have its own version of the tale of “Tears of Malmoe” referring to a goliath crane in Kockums dockyard in Malmoe, Sweden, that made residents of Swedish shipping town weep upon witnessing their mighty structure symbolic for their maritime heyday being sold off to Korea for a mere $1.

According to sources on Sunday, a 700-ton large crane at Sungdong Industrial Co.’s Masan shipyard located in Changwon, Gyeongnam would be shipped off in fire sale. The giant crane weighs 3,200 tons and stands 105 meter tall. A crane to hoist ship blocks is a landmark of each dockyard. Its lifting record and activity underscores the shipbuilding performance.

Malmoe was home to a Swedish shipbuilder Kockums and its 1,500-ton crane was dismantled in 2002 to be shipped to Ulsan after being sold to Hyundai Heavy Industries for $1. The local media dubbed the crane Tears of Malmoe as the residents of the port city wept when they saw their beloved landmark being towed away.

Creditors put Sungdong Industrial’s crane and shipyard property on sale in 2013 after the shipbuilder faced a liquidity crunch due to a global financial crisis in 2008. Sungdong Industrial’s crane was built in 2008 with 27 billion won ($23.5 million) investment. Its initial appraisal price was set at 19 billion won but the price kept falling as no potential bidders expressed their interest.

Dismantling and reassembling the crane causes an additional cost of 4 to 6 billion won and there were no shipbuilders who can afford to buy it. The latest appraisal price was 3 billion won, but no shipyards from home were interested as they are busy with their own restructuring.

Creditors turned their eyes to overseas. To date, potential buyers from Vietnam, Singapore and Malaysia came to Korea to check the crane. More recently, a Romanian shipbuilder has become interested and is in talks with creditors. Creditors are also looking for new owners of smaller cranes of the shipyard.

The original Posted By Woo Sung-deok/Maeil Business News