Taeyoung Group Chairman appeals for help to its creditors

Creditors head to the briefing room at the headquarters of Korea Development Bank in Yeongdeungpo-gu, Seoul, where a briefing session for creditors on Taeyoung Construction\'s workout application was held on Wednesday. By Cho Tae-hyung Reporter

Kang Seok-hoon, chairman of the Korea Development Bank (KDB), said of Taeyoung E&C, which applied for a debt workout, "The builder is not implementing the business normalization plan which was submitted with a workout application," adding, “It is difficult to obtain consent 75 percent of creditors to start the debt workout program."

Taeyoung Group Chairman Yoon Se-young appealed to creditors to "give it a chance," saying the amount of real estate project finance (PF) debt that is raising concerns of insolvency is not as large as reported.

"Taeyoung Group was supposed to use 154.9 billion from the sale of Taeyoung Industries to support Taeyoung E&C, but unlike the original promise, only 40 billion was provided," Kang told reporters after a briefing for Taeyoung E&C creditors at the company's headquarters in Yeouido, Seoul, on January 3.

He added, "The funds from the pledge and sale of Blue One's stake are also said to be used to repay the debt of TY Holdings, which is the group’s holding company.”

“Taeyoung Group received an application for a debt workout on December 28 last year, by promising four things (including the sale of Ecobit and the provision of equity collateral in Pyeongtaek Cyro, but we are very sorry that we did not keep our original promise,” Kang said. "I am very concerned about whether the company will be able to receive the cooperation of creditors."

The start of the debt workout for Taeyoung E&C is possible only when 75 percent of the creditors agree at the first financial creditors meeting which will be held on the 11th. If the decision to start the debt workout is not made, it is highly likely to follow the court management procedure.

In response, a staffer at Taeyoung Group told reporters after the briefing, "The funds from the sale of Taeyoung Industry are all being used to support Taeyoung E&C." This means that TY Holdings is using the funds to repay the joint guarantee debt of Taeyoung E&C's PF project.

Taeyoung Group did not mention to creditors the specific size of private donations made by its owner family, including Chairman Yoon Seok-min. It did not answer whether it would sell its stake in SBS, a major affiliate, or provide it as collateral.

Yoon Se-young, founding chairman of Taeyoung Group, attended its corporate briefing and said, "We will do our best to save Taeyoung."

"There have been some media reports that the scale of Taeyoung E&C’s PF is worth 9 trillion won, but its contingent debt is 2.5 trillion won," Yoon explained in his "appeal to creditors." He added, "The balance of orders is over 12 trillion won, and sales of more than 3 trillion won will be possible every year for the next three years. In a word, Taeyoung E&C is a potential company with many possibilities. Please do your due diligence and help us continue our business."

※This article has undergone review by a professional translator after being translated by an AI translation tool.