Taeyoung stocks plunge over financial restructuring concerns

[Photo by Yonhap]

Taeyoung Engineering & Construction Co. stocks plunged on Thursday as investors raised concerns about uncertainties surrounding the financial restructuring of the South Korean mid-tier builder, which has applied for a debt workout.

As of 9:05 a.m., Taeyoung E&C stocks traded at 2,880 won ($2.20), down by 11.25 percent compared to the previous day’s close. They initially dropped by about 18 percent right after the market opening but partially recovered from the decline.

TY Holdings Co., Taeyoung Group’s holding company, also saw a 6.04 percent drop in its stock price, which fell to 4,510 won. Taeyoung E&C stocks had surged by 23.85 percent on Wednesday, and TW Holdings stocks had also risen by 11.89 percent.

The latest decline is believed to be driven by investors’ doubts about Taeyoung Group’s efforts for a financial restructuring. The market had been expecting serious restructuring plans from the group, including financing from the owner’s family’s assets or the sale of the group’s Seoul Broadcasting System (SBS). However, the group did not address those expectations during the previous day’s briefing session.

As of Thursday morning, SBS stocks rose by 2.41 percent, trading at 31,850 won.

“The main focus in Taeyoung E&C’s restructuring is the company’s commitment to the process. With confirmed differences in opinions between creditors and the company, future discussions could face challenges,” a DB Financial Investment Co. analyst said.