Taeyoung Construction (photo = Yonhap news)

 

[Alpha Biz= Reporter Paul Lee] According to the industry on the 17th, TY Holdings, the largest shareholder of Taeyoung Construction, is expected to maintain its status as the largest shareholder even after the major shareholder Capital reduction without refund.

The previous day, KDB Industrial Bank, the main creditor of Taeyoung Construction, held a steering committee meeting with 18 major creditors to discuss the results of due diligence and corporate improvement plans. Measures to improve the financial structure such as project financing (PF) processing, Capital reduction without refund, and equity conversion have come under fire.

As of the end of last year, Taeyoung Construction's total capital (based on consolidation) was -635.6 billion won, which is currently capital erosion. Taeyoung Construction's due diligence firm estimated that a KRW 1 trillion investment conversion is needed to resolve capital erosion. As a result, major shareholders will have free cuts of 100 to 1 and minority shareholders of 2 to 1. In order to improve the financial structure, major shareholders convert 100% of existing bonds, including loans, and financial creditors convert 50% of unsecured bonds into investments.

TY Holdings, which holds a 27.8% stake in Taeyoung Construction, is expected to retain its position as the largest shareholder even after the free capital reduction and conversion of investment.

 

 

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