In response to the decision of Tmon and Wemakeprice (hereinafter, “T-MAP”) not to extend the Autonomous Restructuring Support (ARS) procedure following major settlement and refund delays, Hyo Jong Choi (34th class, Judicial Research and Training Institute), attorney at LIN, who participated as the sole creditor-side attorney in the rehabilitation proceedings council, said, "At this point, it is necessary and urgent to discontinue the ARS process," adding, "If there is no special unexpected incident, the rehabilitation proceedings will begin, and I expect the M&A to be completed in the first half of next year."
"It was a necessary step to pursue ARS for a month for potentially significant benefits, although the possibility was low," Choi said. He added, "The ARS failed because it was difficult to attract external investment, but it is time to transition to rehabilitation proceedings followed by M&A, which is more likely, considering that the possibility of success of ARS decreases over time."
Currently, one private equity fund has submitted a Letter of Intent (LOI) to T-MAP– contingent upon the commencement of rehabilitation proceedings. Choi said, "After the decision to start the formal rehabilitation proceedings, there will be more bidders in the M&A stage," emphasizing “the need for investors who can continue to invest and have strong financial structures." He added, “Having healthy competition in Korea’s e-commerce sector, rather than monopolization by a few players, is also in the national interest.”
Choi also predicted that the M&A will be completed in the first half of next year after the start of the rehabilitation proceedings and explained, "With no apparent legal grounds for dismissal of rehabilitation proceedings, soon after the decision to launch, pre-authorization M&A in a way of Stalking Horse (way that makes an additional open competitive bid after signing a pre-contract with the prospective acquirer) will be conducted, and it will be completed in the first half of next year." He then expressed confidence in the Seoul Bankruptcy Court's experience and expertise to effectively manage the M&A process under the rehabilitation proceedings.
Attorney Hyo Jong Choi, an expert in bankruptcy law, conducted a number of corporate rehabilitation and bankruptcy-related advice and litigation work, including Ssangyong Motor (currently KG Mobility), Woongjin Group, and Hanjin Shipping. Also, he served as an external research member of the Seoul Bankruptcy Court's TF on ARS system improvement in 2022 and is currently a trustee of corporate bankruptcy at the Seoul Bankruptcy Court.
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The Law Times
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