en.Wedoany.com Reported - South Korea's private equity giant Hahn & Company recently announced the sale of 10 Very Large Crude Carriers (VLCCs) operated by its subsidiary SK Shipping to Pan Ocean, with a total transaction value of 973.7 billion won (approximately $694 million). This transaction not only involves the transfer of vessel assets but also includes long-term freight contracts associated with major domestic Korean shippers. The deal is expected to be completed by April 11, 2027.
It is reported that Hahn & Company acquired a controlling stake in SK Shipping in 2018. This divestiture of VLCC assets marks a significant step in reshaping SK Shipping's fleet structure and commercial positioning. Looking back, South Korea's flagship shipping company HMM attempted to acquire SK Shipping last year, but persistent and irreconcilable valuation differences ultimately led to the shelving of the acquisition plan. Hahn's decision to split and sell the VLCC assets is also viewed within the industry as a strategic adjustment to optimize asset allocation and focus on core business.
Since its acquisition by Hahn in 2018, SK Shipping embarked on a business transformation path, with the core direction being the gradual divestment of volatile spot market operations and a strategic focus on long-term freight contracts. This strategic shift has yielded significant results. Financial data shows that SK Shipping's operating profit soared from 73.3 billion won in 2018 to 395.7 billion won in 2024. During the same period, its EBITDA also grew from 231.7 billion won to 640.9 billion won, achieving a leap in profitability.
Regarding the use of proceeds from this VLCC sale, SK Shipping explicitly stated that the funds will be reallocated to other shipping segments. This move signifies that the company will further scale back its presence in the VLCC sector and pivot towards shipping segments with greater development potential or those better aligned with its strategic positioning, suggesting a new round of optimization in its future business structure.
Notably, this VLCC asset transaction occurs against the backdrop of a continuously heating global VLCC market. This market fervor is closely linked to the aggressive moves of another South Korean shipping company – Sinokor Merchant Marine (Sinokor). Market monitoring indicates that over the past few months, Sinokor has initiated a VLCC "buying spree," having cumulatively acquired over 50 VLCCs and secured a substantial amount of additional capacity through chartering. Its dual-track expansion strategy of "acquiring ships on the asset side + chartering ships on the leasing side" has directly reshaped the liquidity and pricing system of the VLCC market, driving sustained bullish market sentiment.
Industry analysis points out that the current VLCC market is in the middle-to-later stage of a "super-profit cycle dominated by hard supply constraints." The global VLCC fleet's net growth rate in 2026 is projected to be only 2.1%. Factors such as a gap in new vessel deliveries and the gradual retirement of the aging fleet have further exacerbated the tight capacity situation. This serves as the core backdrop for Sinokor's aggressive expansion and also provides a favorable market environment for Hahn's sale of VLCC assets.
The completion of this transaction will not only alter the capacity landscape of the domestic South Korean VLCC market but will also exert a certain influence on global VLCC asset pricing. Following the acquisition of 10 VLCCs and related long-term freight contracts, Pan Ocean is expected to further enhance its capacity scale and market clout in the crude oil transportation sector. Meanwhile, by divesting the VLCC assets, Hahn has completed a phased strategic reshaping of SK Shipping. The strategic moves by both parties may provide a new reference model for the transformation and development of South Korean shipping enterprises navigating industry cycles.
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