Daewoo Shipbuilding and Marine Engineering is to receive $470 million from four ship owners earlier than expected, easing concerns about the liquidity of the money-losing shipbuilder, industry sources said Tuesday.

The plan was disclosed ahead of the upcoming expiry of its corporate bill, according to the sources. 


The Korean shipbuilder said that the four ship owners agreed to make payments earlier than expected and they are expected to do so no later than next month.

Another client company that placed an order for a marine project also gave a positive response over paying prepaid expenses of $150 million soon, the company said.

The five client companies’ payments will ensure the shipbuilder secures $620 million ahead of the expiry of the corporation bill.

DSME is slated to face the expiry of its corporation bill worth 400 billion won ($316 million) next month.

There had been speculation that the company would suffer difficulties over paying back the corporation bill as scheduled.

As part of efforts to secure liquidity, DSME CEO Jung Sung-leep visited European ship owners last month to negotiate receiving payments early.

The takeover delay of Angola’s state-run oil company Sonangol’s project -- an order for two drill ships -- had also added to uncertainty over DSME meeting the corporation bill deadline.

Sonangol, which initially planned to take over the two ships in return for payment of about 1 trillion of the contract fee in June and last month, postponed the dates, citing the creditor’s issue.

By Lee Hyun-jeong  (rene@heraldcorp.com)