Tae-young, who received the 'final ultimatum,' says "Still deliberating... Difficult to provide an answer today"

Authorities and Creditors Demand "Additional Self-Rescue Plan by Weekend"

Taeyoung Group stated on the 7th, the deadline for the financial authorities and creditors' 'final ultimatum' regarding Taeyoung Construction's workout application, that they are "still deliberating."

A representative of TY Holdings, the holding company of Taeyoung Group, said in a phone interview with Yonhap News on the same day, "There are not many options, but we are continuing to deliberate to find a way to alleviate the concerns of the government and creditors," adding, "It seems difficult to provide an answer within today." Earlier, the financial authorities and creditors hinted at the possibility of the workout falling through and demanded that Taeyoung Group submit additional self-rescue plans by the weekend.

On the 28th of last month, when Taeyoung Construction, experiencing a liquidity crisis due to real estate project financing (PF), applied for a workout (corporate restructuring), the Taeyoung Construction flag was fluttering in the wind at the Taeyoung Building in Yeongdeungpo-gu, Seoul. Photo by Jinhyung Kang aymsdream@

With Taeyoung Group officially announcing its inability to respond on the day, the sense of crisis over the potential collapse of Taeyoung Construction's workout is expected to intensify. However, since Taeyoung Group is known to have conducted internal discussions and behind-the-scenes talks with the authorities and creditors over the weekend, and stated that they are "still deliberating," there remains a possibility that additional self-rescue plans will be presented soon.

The core of Taeyoung Group's internal dilemma is the 89 billion KRW from the sale proceeds of Taeyoung Industry. On the 3rd, Taeyoung Group agreed with the creditors to support Taeyoung Construction with 154.9 billion KRW out of the 206.2 billion KRW sale proceeds of Taeyoung Industry, excluding 51.3 billion KRW corresponding to the stake held by Yoon Se-young, the founder's daughter. However, 89 billion KRW of this amount was used to resolve the joint debt of Taeyoung Construction under TY Holdings, which provoked opposition from the creditors. The creditors judged that using this money to resolve TY Holdings' joint debt did not constitute support for Taeyoung Construction. Therefore, to continue the workout discussions, the issue of the 89 billion KRW must be resolved first.

Meanwhile, some in the industry speculate that Taeyoung Group may be able to inject additional funds equivalent to this amount. Given Taeyoung Group's ownership structure, the entities capable of raising additional funds are TY Holdings and SBS. However, SBS faces restrictions such as limits on large shareholder stakes under the Broadcasting Act and the need for approval from the Korea Communications Commission for changes in the largest shareholder. Therefore, there is talk that liquidity must be secured by utilizing the ownership stake of the founding family in TY Holdings.

Whether the founding family will make additional personal contributions is also a major point of interest. The industry had predicted that the scale of personal contributions before the announcement of Taeyoung Group's self-rescue plan could reach up to 300 billion KRW, but the actual amount falls far short of this. The total personal contributions made so far by Chairman Yoon Seok-min and the founding family amount to 48.4 billion KRW. However, after deducting amounts overlapping with the self-rescue plan disclosed to the creditors, the actual amount is estimated to be about 6.8 billion KRW. TY Holdings stated regarding the personal contributions, "We fully recognize the necessity and are preparing and proceeding accordingly."

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