Liabilities Reach 79 Billion KRW... Hearing Scheduled for June 25
Series of Rehabilitation Proceedings for Mid-Sized Construction Firms in Gwangju
Youngmu Togeon, a mid-sized construction company based in Gwangju, has filed for corporate rehabilitation (court receivership) with the court.
According to the legal community on May 28, Youngmu Togeon submitted an application to commence rehabilitation proceedings to the Bankruptcy Division 1 of the Gwangju District Court (Presiding Judge Yoo Seokdong) on May 20. The court announced a comprehensive prohibition order on Youngmu Togeon's assets the previous day. This comprehensive prohibition order is a measure to prevent creditors from seizing or provisionally seizing assets before a decision is made regarding rehabilitation.
According to the financial statements submitted by Youngmu Togeon to the court, its liabilities were reported to be approximately 79 billion KRW.
Youngmu Togeon was founded in 1997 under the name Seohae Togeon and ranked 111th nationwide in last year's construction capability assessment by the Ministry of Land, Infrastructure and Transport. The company has carried out housing projects across the country, led by its own apartment brand, 'Youngmu Yedaeum.'
The reasons for the rehabilitation application are reported to be a liquidity crisis caused by rising raw material prices, increased labor costs, and unsold housing units. A hearing to determine whether to commence rehabilitation proceedings is scheduled for the afternoon of June 25.
Meanwhile, among mid-sized construction companies in the Gwangju and Jeonnam regions, both Hanguk Construction and Namyang Construction also received court decisions to commence rehabilitation proceedings last year.
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