Ankang Construction Rehabilitation Proceedings Initiated... Only 21 Days After Application

Seoul Rehabilitation Court Decides to Commence Rehabilitation Process
Liquidity Worsened by Rising Raw Material and Labor Costs, Interest Rate Hikes
Rehabilitation Plan Must Be Submitted by June 26

Mid-sized construction company Angang Construction, ranked 116th in construction capability evaluation, is entering court receivership (rehabilitation process).

The 17th Division of the Seoul Rehabilitation Court (Chief Judge Lee Young-nam, Presiding Judge Won Yong-jun) decided to commence the rehabilitation process for Angang Construction on the 17th. The Seoul Rehabilitation Court explained the cause of Angang Construction's financial collapse as "a recent sharp rise in construction costs (raw material prices and labor costs), real estate market downturn, and increased financial costs due to interest rate hikes, which have worsened cash flow liquidity, and a significant portion of the debtor's liquid assets are expected to be unrecoverable or difficult to recover in the short term."

The court did not appoint a separate administrator when deciding to commence the rehabilitation process. If no administrator is appointed, the current CEO is considered the administrator. However, the management may be replaced if any illegal activities are discovered in the future. Angang Construction must prepare and submit a list of creditors by the 3rd of next month. The creditor filing period is until April 24, and the creditor investigation period is until May 15. Hyundai Accounting Corporation has been appointed as the investigation committee, and based on the investigation report, the rehabilitation plan must be submitted by June 26.

Angang Construction, which owns brands such as 'Dior Nine (residential-commercial complex)', 'Lux Nine (officetel)', and 'Pantheon Square (mixed commercial facility)', submitted a corporate rehabilitation application to the Seoul Rehabilitation Court on the 24th of last month. A representative from Angang Construction stated, "Despite the company's excellent construction capabilities, we applied for rehabilitation due to a surge in subrogation payments caused by joint guarantees with developers, an increase in provisional seizures by financial institutions, and liquidity decline due to unpaid balances at completed sites." Two days later, on the 26th, the court announced a comprehensive prohibition order. The commencement decision was made 21 days after the application.