Taeyoung, Tomorrow's Debt Restructuring Plan Briefing... Workout Difficulties

Taeyoung Construction to Hold Creditors' Meeting Tomorrow
Taeyoung Industry Sale Funds
Controversy Over Default on Maturing Bond Repayment

TY Holdings, the holding company of Taeyoung Construction, which applied for a corporate restructuring workout due to the insolvency of real estate project financing (PF), has been confirmed to have not yet repaid several hundred billion won of the Taeyoung Construction guarantee debt worth over 100 billion won that has matured, drawing attention to the self-rescue plan Taeyoung Construction will present to its creditors.

According to the financial industry on the 2nd, Taeyoung Construction will hold a briefing session on the self-rescue plan for more than 400 creditors at the Korea Development Bank at 3 p.m. on the 3rd. At this meeting, the scale of the Taeyoung owner family's private fund contribution and the handling plan for the guarantee debt are expected to emerge as major issues.

At the briefing, Taeyoung Construction is expected to disclose plans to sell affiliates such as Ecobit (a comprehensive environmental company) and Blue One (golf course and leisure business), as well as the major shareholder's private fund contribution plan. Blue One owns golf courses including The Dyanus CC, Blue One Yongin CC, and Blue One Sangju CC. The book value of the owner family's stake is about 12.8 billion won.

On the 28th, Taeyoung Construction, which is experiencing a liquidity crisis due to real estate project financing (PF), applied for a workout (corporate restructuring) at the entrance of Taeyoung Construction headquarters in Yeongdeungpo-gu, Seoul. Photo by Jinhyung Kang aymsdream@

Earlier, TY Holdings announced on the 28th of last month, when applying for Taeyoung Construction's workout, that as part of the self-rescue plan, it would use 240 billion won from the sale of Taeyoung Industry to cover 148.5 billion won of Taeyoung Construction's trade receivables maturing on the 29th of last month. It also disclosed that it resolved to lend 113.3 billion won of the sale proceeds held by TY Holdings to Taeyoung Construction.

However, in a corrected disclosure on the same day, Taeyoung Construction stated, "On the 29th of last month, we borrowed 40 billion won from TY Holdings to repay trade receivables," adding, "The remaining 73.3 billion won is planned to be borrowed as needed." Taeyoung Construction repaid the trade receivables of 148.5 billion won maturing on the 29th of last month, excluding 45.1 billion won of accounts receivable secured loans (external loans).

External loans refer to loans banks provide using accounts receivable as collateral, where Taeyoung paid its partner companies with accounts receivable instead of cash, and the companies obtained loans from banks secured by these receivables. Previously, Taeyoung had announced that it would use 240 billion won from the sale of Taeyoung Industry to settle trade receivables as part of the self-rescue plan when applying for the workout, but this has not yet been implemented.

Regarding this, it is known that financial authorities and creditors have expressed dissatisfaction with Taeyoung Construction's failure to implement the original self-rescue plan.

The workout applied for by Taeyoung will be decided at a creditors' meeting on the 11th. It requires the consent of more than 75% of the creditors, and there are expectations that the workout will not be easy.

This content was produced with the assistance of AI translation services.