Korea Credit Guarantee Fund Launches 'Rehabilitation Company M&A Guarantee'... "3.2 Billion KRW Support"

Corporate Rehabilitation M&A Guarantee, Issues No. 1 and 2
Guarantee Limit Expanded Up to 80% of Required Funds Based on Credit Rating

[Asia Economy Reporter Ki Ha-young] The Korea Credit Guarantee Fund (KODIT) announced on the 3rd that it has provided a total of 3.2 billion KRW in 'Rehabilitated Company M&A Guarantees' to two companies pursuing the acquisition of rehabilitated companies.

The Rehabilitated Company M&A Guarantee is a guarantee product introduced by KODIT in September last year to support the funds necessary for acquiring companies undergoing rehabilitation procedures under the "Debtor Rehabilitation and Bankruptcy Act."

The companies supported by KODIT this time plan to maximize M&A synergy effects by acquiring rehabilitated companies that operate in the same industry within the local community to expand their business network or that possess core technologies for entering new businesses. Additionally, the rehabilitated companies being acquired will maintain employee employment, and creditors can receive lump-sum repayment of their claims through the acquisition price, benefiting the acquiring companies, rehabilitated companies, and creditors alike.

KODIT is making efforts to revitalize the Rehabilitated Company M&A Guarantee. To discover demand for the guarantee and establish a close cooperation system with the court, KODIT signed a business agreement with the Seoul Rehabilitation Court in November last year, and expanded the guarantee limit from within 50% of the required funds to 60%?80% depending on the credit rating.

A KODIT official stated, "We will continue to do our best to support the successful restructuring and business normalization of companies under rehabilitation and to create a healthy corporate ecosystem."