Board votes Thursday to call extraordinary shareholder meeting

Extraordinary general meeting set for Nov. 25

Term to run through March 2028

12 container ships to be acquired for 2.2 trillion won

HMM President and CEO Choi Won-hyuk delivers a commemorative address at the company's 50th anniversary ceremony held at HMM's Yeouido headquarters earlier this year. [HMM]
HMM President and CEO Choi Won-hyuk delivers a commemorative address at the company's 50th anniversary ceremony held at HMM's Yeouido headquarters earlier this year. [HMM]

HMM is moving to reappoint President and CEO Choi Won-hyuk ahead of the expiration of his term next March, initiating an early renewal of his inside director position to ensure continuity on key management priorities including the relocation of its headquarters to Busan and a major fleet investment drive.

HMM announced Thursday that its board of directors had resolved to convene an extraordinary general meeting of shareholders to reappoint Choi as an inside director.

The extraordinary general meeting is scheduled for Nov. 25. HMM said Choi will resign from his current inside director post that day before being reappointed at the same meeting.

If the reappointment is approved, Choi's new term as inside director will run through the date of HMM's annual general meeting in March 2028. Choi took office in March last year and was originally set to complete his term in March next year, but the reappointment process has been brought forward by roughly four months.

Choi is a logistics industry veteran with more than 40 years of experience at CJ Logistics and LX Pantos, among other firms. He served as chief executive of Pantos and LX Pantos for about eight years starting in 2015 before taking the helm at HMM last year.

Since Choi took office, HMM has pursued the relocation of its headquarters to Busan and a broader expansion of medium- and long-term investment. The company held an unveiling ceremony at its new Bujeon-dong office in Busan on Tuesday, formally marking the start of its Busan era.

About 120 employees are currently working at the Busan headquarters, with additional staff transfers still under way. HMM's long-term plan calls for constructing a new dedicated office building at Busan's North Port. Further transfers of Seoul-based staff and labor-management consultations remain key tasks ahead.

An HMM container ship [HMM]
An HMM container ship [HMM]

HMM's board also approved a major vessel investment at Thursday's meeting, committing 2.17 trillion won ($1.62 billion) to acquire 12 new container ships.

The plan calls for ordering eight new 13,000-TEU container ships — where one TEU equals one 20-foot container — and purchasing four vessels already under construction or nearing delivery. The vessels to be purchased comprise three ships of 2,800 TEU and one of 1,700 TEU. Total capacity across all 12 ships will reach 114,100 TEU.

The total investment stands at $1.62 billion, with the investment period running from Thursday through the end of December 2029.

The move aligns with HMM's "2030 Mid- to Long-Term Strategy" announced last July. Under that plan, HMM aims to invest a total of 29 trillion won by 2030 to expand its container fleet to 166 vessels with a combined capacity of 1.47 million TEU, while growing its bulk carrier fleet to 110 ships totaling 13.52 million deadweight tons.

The company also plans to strengthen its deep-sea and short-sea route networks, secure terminal and port infrastructure at key overseas hubs, and step up investment in eco-friendly vessels and digital transformation.

Growing optimism about HMM's earnings recovery has accompanied an improvement in shipping market conditions. Hana Securities on Thursday raised its third-quarter operating profit forecast for HMM from 847 billion won to 1.06 trillion won — a 257 percent increase from the same period last year. If realized, the figure would mark HMM's first quarterly operating profit above 1 trillion won in seven quarters.


kwater@heraldcorp.com