Last year, TMON and WEMAKEPRICE (hereafter referred to as T-MAP) caused a large-scale unaccounted and unreimbursed incident amounting to around 1.5 trillion won, prompting them to actively seek new ownership through mergers and acquisitions (M&A). Their goal is to increase corporate value after the M&A and then sell.
The legal managers of T-MAP are considering individual sales instead of the previously planned bulk sale. They aim to complete the M&A by the end of April.
Jo In-cheol, the chief legal manager of T-MAP, revealed this during the 'creditor briefing related to the T-MAP incident' held at 2 p.m. on the 15th at the Seoul Bar Association building.
The briefing was conducted in two sessions. TMON's session was held at 2 p.m., followed by WEMAKEPRICE at 3:30 p.m., each lasting one hour. About 90 creditors attended in person, while the remaining creditors participated via online video conference.
Jo reported on the status of the rehabilitation process, debts, asset conditions, the rehabilitation plan, and early normalization strategies.
In response to creditors' questions about whether they are also considering individual sales regarding the current M&A progress, Jo stated, 'Previously, we approached it with the intent of a bulk sale of both companies, but the market response to selling them together has not been favorable. Currently, we are pivoting towards individual sales.'
Jo added, 'A total of five corporations have been contemplating whether to acquire, with three so far submitting letters of intent (LOIs).'
One of the entities that submitted a letter of intent is the Chinese state-owned enterprise, China National Chemical Corporation. Jo remarked, 'While China National Chemical Corporation has already been exposed in the media, there have been no developments since then.' He continued, 'The remaining two are domestic corporations, and we cannot disclose their names at this time as discussions regarding M&A are ongoing.'
When asked by creditors how long T-MAP can maintain its corporate structure with the funds currently being operated, Jo replied, 'We can hold out until the end of April,' but added, 'The goal is to proceed with the M&A as quickly as possible before the end of April rather than just endure.'
However, it is challenging to submit the related documents by the originally scheduled date of February 7 for the rehabilitation plan.
Jo explained, 'We plan to apply for an extension of the rehabilitation plan submission date, but it is difficult to confirm how long of an extension will be sought.' He continued, 'Once we confirm the conditional preferred bidders, we will set a specific timeline. Currently, we are working to expedite the M&A process using the stalking horse method (conducting a public auction alongside selecting a preferred bidder).'
Meanwhile, EY Han Young accounting firm, which is both the investigation commissioner for T-MAP and the sales agent, calculated TMON's liquidation value and going concern value at 13.6 billion won and -92.8 billion won, respectively. For WEMAKEPRICE, the liquidation value is 13.4 billion won, while the going concern value is -223.4 billion won. This indicates that liquidating as a debtor provides better economics than continuing to operate as a going concern.
Jo identified one of the reasons for T-MAP's failure to rehabilitate as the erratic management and large-scale fund outflows from TMON's parent company, Qoo10 Group, under the leadership of CEO Gu Young-bae.
According to an investigation report obtained by CHOSUNBIZ, since T-MAP was acquired by Qoo10 Group, funds have been siphoned off under the pretense of lending to related parties and have yet to be recovered. The amount siphoned from TMON to related parties is 134.9 billion won, while WEMAKEPRICE has 46.8 billion won.
When the creditors inquired about whether to pursue criminal charges against the management team, Jo responded, 'The management has already been criminally indicted. Consequently, T-MAP has recommended suspending the duties and unpaid status of the existing representatives.' However, he noted, 'Since CEO Gu Young-bae appears to be the final decision-maker, we are also considering filing a lawsuit for damages, in consultation with legal representatives.'