SEOUL – Trading of shares for Taeyoung Engineering and Construction Co., a significant construction entity, has been halted due to a negative net asset balance amid ongoing debt restructuring efforts.
According to Yonhap News Agency, the suspension came into effect on Wednesday as the firm grapples with financial difficulties, particularly relating to liquidity shortages from real estate project financing loans.
The Korea Development Bank, Taeyoung's principal creditor, announced an extension of up to one month in the deliberation period for the company's restructuring plan. This extension aims to provide additional time to finalize strategies for the company's financial normalization. Taeyoung, ranked as the 16th largest builder in South Korea, sought a debt restructuring program in December of the previous year due to these liquidity issues.
The company disclosed in a regulatory filing that its total assets have plummeted to a deficit of 562.6 billion won ($427.5 million), leading to a suspension of stock trading on the Korea Composite Stock Price Index. The negative net worth situation, where liabilities surpass assets, is part of the company's ongoing financial restructuring, exacerbated by losses from project financing loans.
Despite the grim financial situation, Taeyoung expressed optimism that the restructuring process would alleviate the contingent liabilities stemming from the project financing businesses. Furthermore, creditors reassured that the negative net asset status would not impede the restructuring process and consented to a deferment of Taeyoung's debt repayments until April 11. However, the company must still procure operational funds, including labor and construction costs, which are anticipated to surpass 500 billion won before a final restructuring plan is ratified.
The liquidity crisis faced by Taeyoung reflects broader issues in the real estate sector, exacerbated by high interest rates and a declining property market. The company's outstanding project financing loans amount to 3.2 trillion won, underscoring a significant risk to the financial sector and the South Korean economy. In response, the government has pledged to augment liquidity supply programs as necessary to mitigate these risks.
SEOUL — A civic organization has announced plans to initiate a collective lawsuit against Coupang, South Korea's leading e-commerce platform, over allegations of maintaining an employment blacklist.According to Yonhap News Agency, labor, and human rights, around 80 individuals allegedly affected by the blacklist have been contacted so far. The organization intends to file the lawsuit within the current month. Allegations have surfaced claiming that Coupang has compiled a list to prevent certain individuals from being reemployed, particularly in its warehouse operations. This list reportedly includes personal details of the individuals and reasons for their previous resignations.
One of the whistleblowers, Kim Joon-ho, claimed that during his tenure at the Coupang Fulfillment Service from 2022 to 2023, he was instructed to avoid hiring individuals who had received low performance evaluations. The civic group alleges that a specific Coupang employee managed the list, highlighting that the intranet domain, accessible only to the company's human resources team, contains the term "blacklist."
In light of these allegations, the civic group has called for Coupang to cease any suppression of whistleblowers and intimidation of the press. Furthermore, it has urged the Anti-Corruption and Civil Rights Commission to provide protection for those who have come forward with complaints.