[Alpha Biz= Kim Jisun] Samjeong Construction and Samjeong E&C, the contractors of the Banyan Tree Resort in Busan, where a fire claimed six lives, have filed for corporate rehabilitation due to liquidity crises.
On Thursday, the companies announced that they had submitted a corporate rehabilitation application to the bankruptcy court. They cited the recent downturn in the construction industry and rising material costs, which have led to outstanding receivables of approximately 250 billion won, causing liquidity challenges and disruptions in long-term development projects.
They further explained that the recent fire at the Banyan Tree Resort construction site has made the recovery of remaining construction payments uncertain, while financial institutions have halted additional funding, worsening their financial distress. "Samjeong Construction and Samjeong E&C had already invested over 100 billion won of their own funds into the project due to sluggish sales but have yet to receive payment from the developer," the companies claimed.
The firms assured stakeholders that they would strive to restructure their finances and normalize operations through the rehabilitation process. "We promise to conduct this corporate rehabilitation procedure transparently and sincerely, minimizing the impact on creditors while maintaining responsible management under court supervision," they stated.
Samjeong Construction also expressed condolences regarding the fire, saying, "We extend our deepest sympathies to the victims who lost their precious lives in the Banyan Tree fire and offer heartfelt condolences to their families." The company pledged to provide appropriate compensation and support to the victims and their bereaved families, independent of the rehabilitation process.
The fire broke out at 10:51 a.m. on February 14 at the Banyan Tree Haeundae Busan construction site near Orangdae Park in the Osiria Tourism Complex, Gijang County, Busan. The incident resulted in six fatalities and left 27 others with minor injuries, including smoke inhalation.
AlphaBIZ Kim Jisun(stockmk2020@alphabiz.co.kr)
