Angang Construction begins rehabilitation process and submits plan by June 26

The court accepted the application for corporate rehabilitation proceedings (court management) for the mid-sized construction company Angang Construction.

The 17th Division of the Seoul Rehabilitation Court (presiding Judge Director General Lee Young-nam) noted that it made a decision to initiate rehabilitation proceedings for Angang Construction on the 17th. Angang Construction applied for court management at the Seoul Rehabilitation Court on the 24th of last month.

The court disclosed that the reason for the company's financial insolvency related to the initiation of rehabilitation proceedings was due to 'the sharp increase in construction costs (raw material prices and labor costs), the downturn in the real estate market, and the rise in financial costs due to interest rate increases, which worsened liquidity'. It also stated that 'a significant portion of the debtor’s liquid assets is expected to be uncollectable or difficult to collect in the short term.'

The court did not appoint a separate administrator. Accordingly, the current representative is regarded as the administrator, allowing the existing executives to manage the company during the rehabilitation proceedings. However, if any illegal activities are revealed in the future, the management may be replaced.

The creditors' council will consult on the overall rehabilitation proceedings, including improving the financial structure of the debtor company. A Chief Restructuring Officer (CRO), appointed upon the recommendation of the creditors' council, will oversee the company’s cash flow and other financial aspects.

The deadline for reporting claims resulting from the initiation of rehabilitation proceedings is set until April 24, and the claims investigation period is until May 15. The court has designated the deadline for submitting a rehabilitation plan as June 26.

Angang Construction, established in January 2015, is a mid-sized construction company that ranked 116th in construction capability assessment as of last year. It holds brands in dwellings such as 'DIO Nine (mixed-use complex)', 'Lux Nine (officetel)', and 'Pantheon Square (mixed-use commercial facility)'. As of 2023, it reported sales of 233.3 billion won, a net profit of 1.11 billion won, and a liability ratio of 157.5%.