All Three Self-Rescue Scenarios for Timef Are 'Mountain Beyond Mountain'

On the 2nd, TMON and WEMAKEPRICE Corporate Rehabilitation Hearing
Self-Rescue Plans Expected to Include Capital Inflow, M&A, and Restructuring

Attention is focused on the self-rescue plans to be prepared by both companies, TMON and WEMAKEPRICE, as well as Koo Young-bae, CEO of Qoo10 and the ultimate person responsible for the issue, ahead of the court’s corporate rehabilitation hearing. This plan is directly linked not only to the recovery of both companies but also to compensation for victims of the recent settlement delay incident. Summarizing the plans mentioned so far by CEO Koo and other key executives, the ‘Timap’ self-rescue plan, which must be explained to the court and used to persuade creditors, is expected to include three main directions: securing funds through Qoo10, pursuing mergers and acquisitions (M&A), and restructuring. All three directions need to be pursued, but challenges are anticipated.

On the 2nd, the court will conduct hearings with the CEOs of TMON and WEMAKEPRICE, who have filed for corporate rehabilitation. It usually takes about a month to decide on the commencement, but both companies have applied for a new Autonomous Restructuring Support program (ARS program) operated within the rehabilitation system by the court. The court may approve this program to allow the company and creditors to autonomously seek solutions first, aiming to minimize damage. If this happens, the start of the corporate rehabilitation process could be postponed for up to three months.

The issue lies in the effectiveness of the repayment plan included in Timap’s self-rescue plan. First, the fund inflow plan through Qoo10 includes the 80 billion KRW mentioned by CEO Koo. He stated at the National Assembly’s Political Affairs Committee on the 30th of last month, “The maximum funds the group can mobilize are 80 billion KRW.” However, he also said that due to Chinese regulations and other reasons, it is difficult to use this immediately as settlement funds. There are also methods such as disposing of Qoo10’s assets or shares or obtaining loans through collateral. CEO Koo said he is exploring loans at the Qoo10 level. However, Qoo10’s corporate value has plummeted, making even this difficult. CEO Koo himself said that when things were going well, the share value was recognized up to 500 billion KRW, but the current situation has made it difficult.

M&A and funding may also be included in the self-rescue plan. CEO Koo said, “We are pursuing funding and M&A at the Qoo10 group level.” This includes the option of selling TMON, WEMAKEPRICE, and Interpark Commerce separately. Interpark Commerce, which is not a party to the corporate rehabilitation application, is reportedly being considered for sale. Various methods such as selling TMON and WEMAKEPRICE separately or merging them before sale are expected to be reviewed. However, it is uncertain whether M&A can be successfully completed given the evident value deterioration and the unclear scale of debts such as unsettled amounts. Funding is also considered difficult. Major shareholders of Qoo10, Monster Holdings and Wonder Holdings, have not stepped forward either. Funding through restructuring funds mentioned by both companies at the time of the corporate rehabilitation application is expected to be included in the self-rescue plan.

The restructuring plan is expected to focus on merging TMON and WEMAKEPRICE to restructure and create a profitable structure. The plan involves improving the cost structure through the merger and shifting to a profitability-centered business structure. Management through partner associations and direct participation in the board of directors may also be included in this plan. Regarding the problematic settlements, there is a plan to introduce a system where a third financial institution holds the funds and pays sellers after customers’ purchase confirmations. However, such a plan presupposes that overdue settlements are completed and services have resumed.

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