Government Support and Koo Young-bae's Private Fund Contribution... Clues to Resolving the Tmon and Wemakeprice Crisis (Comprehensive)

Government: "Liquidity Support of 560 Billion Won for SMEs and Small Business Owners Affected by Tmep"
Gu Young-bae: "Resolve the Situation by Selling All Assets or Using Them as Collateral"

The TMON and WEMAKEPRICE crisis, which had been spreading uncontrollably, is beginning to find a resolution. Following the government's decision to provide over 560 billion KRW in liquidity support to small and medium-sized enterprises and small business owners affected by the delayed payment settlements of TMON and WEMAKEPRICE, Koo Young-bae, CEO of Qoo10, who is responsible for the incident, also expressed his willingness to resolve the issue through personal fund contributions. However, while the immediate crisis may be addressed, the question remains whether Qoo10 can secure the funds to pay the overdue settlements, suggesting that aftershocks are likely to continue.

On the 29th, Koo Young-bae, CEO of Qoo10, stated in a press release, "I bow my head in apology to the customers and all partners who suffered damages due to the delayed settlements of TMON and WEMAKEPRICE," adding, "Qoo10 has been preparing measures to assess the damage, provide relief to victims and partners, and restore normal management for both TMON and WEMAKEPRICE."

The current estimated customer damage reported by CEO Koo amounts to approximately 50 billion KRW, mainly related to travel products. He explained, "We will continue to receive damage reports and process refunds," and "To support this, Qoo10 is urgently securing liquidity to provide financial support for damage recovery for both companies." The liquidity securing methods include the inflow of overseas funds held by Qoo10 and the inflow of new funds through the disposal or collateralization of Qoo10’s assets and shares.

However, CEO Koo expressed concerns that the exact scale of seller damages is difficult to estimate and that the damage could increase if the companies fail to restore the existing settlement support system with their partners. He said, "We are preparing seller compensation programs such as delayed interest payments and commission reductions for partners, and are making efforts to communicate and cooperate with partners, financial institutions, and related agencies."

The government estimates the unpaid amount for sellers at about 210 billion KRW. Considering transactions with upcoming settlement dates, this amount is expected to grow. Accordingly, the government has decided to supply liquidity exceeding 560 billion KRW to sellers who are experiencing or are expected to experience financial difficulties due to not receiving payment properly. Specifically, this includes 200 billion KRW in emergency management stabilization funds through the Small and Medium Business Corporation and the Small Enterprise and Market Service for SMEs and small business owners, 300 billion KRW through credit guarantee and industrial bank agreement programs, and 60 billion KRW in support for travel agencies.

Qoo10 is also pursuing funding and mergers and acquisitions (M&A) at the group level to secure liquidity for both TMON and WEMAKEPRICE. CEO Koo himself stated that he would use most of his personal assets, including selling or leveraging his entire Qoo10 stake as collateral, to resolve the crisis. He expressed, "I deeply acknowledge my managerial responsibility and will mobilize all available resources at the group level and use personal assets to make every effort to secure liquidity for both TMON and WEMAKEPRICE."

Once the crisis is resolved, Qoo10 plans to undertake business structure adjustments and management system innovations at the group level. CEO Koo added that they are actively considering cost structure improvements through mergers among affiliates, transitioning to a profitability-centered business structure, and direct participation in management and the board of directors through partner associations.

The government is also mobilizing all related ministries to prevent the spread of consumer and seller damages and plans to conduct a focused inspection of illegal activities related to the WEMAKEPRICE and TMON crisis through a joint inspection team of the Financial Supervisory Service and the Fair Trade Commission. Additionally, to prevent similar issues from recurring, the government plans to review the appropriateness of related laws such as the Electronic Commerce Act and the Electronic Financial Transactions Act and prepare institutional improvement measures concurrently.

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