"The main reason for receivership was charter payments. If the market situation improves, we can graduate from court receivership within a year," a Korea Line spokesman told Reuters.
South Korea's second-biggest dry bulk shipping line filed for bankruptcy protection in late January, struggling with high-cost charter contracts amid a sharp drop in freight rates since the economic turmoil of 2008.
This had rocked confidence in the shipping industry and provoked fears that other bulk shippers may be exposed to Korea Line, weighing on their shares.
Korea Line operates 150 vessels, or 70 percent of its total fleet, borrowed from other shipping companies, many on long-term contracts finalised before the huge downturn in the dry bulk market.
Under a court-appointed manager and its Chairman Lee Jin-bang, Korea Line's charter or freight payments will be subject to court decision as part of corporate rehabilitation. (Reuters)
