South Korea’s National Pension Service has a decision to make — help the world’s biggest shipmaker survive, or let it die, according to Bloomberg News today. Creditors to Daewoo Shipbuilding & Marine Engineering Co. are due to meet next week to decide whether to convert some of the 1.55 trillion won ($1.4 billion) of bonds into equity to help the unprofitable company. Tipping the scale will be the decision of NPS, the biggest holder of debt that matures this month. “If the National Pension Service doesn’t agree to the debt restructuring plan, then Daewoo Shipbuilding will no longer exist,” said Choi Gwang-shik, an analyst at HI Investment & Securities Co. in Seoul. It’s the biggest test for South Korea’s lenders after Korea Development Bank, the shipbuilder’s majority shareholder, allowed Hanjin Shipping Co. to collapse last year after refusing to support its debt restructuring plan. Hanjin’s demise stranded about a hundred container ships around the world and roiled the global supply chain, putting some 11,000 jobs at risk. A Daewoo shutdown could be much worse, jeopardizing up to 50,000 jobs and $34 billion of vessel orders from companies.
