The court decided to put on hold for a month whether to open rehabilitation proceedings for real estate investment company JR Global REIT. The move follows JR Global REIT's application for the Autonomous Restructuring Support (ARS) program.
The Seoul Bankruptcy Court said in a media notice on the 15th that it will defer the decision on whether to open proceedings for JR Global REIT until the 15th of next month. However, an extension within one month is possible upon application or ex officio.
On the background of deferring whether to open rehabilitation proceedings, the court explained that it is a routine step because JR Global REIT, after filing for rehabilitation, sought procedures under the ARS program.
The ARS program is a system in which corporations, after filing for court rehabilitation, put the opening decision on hold for the time being and negotiate voluntary debt reorganization with the creditor group. Instead of court-led rehabilitation, the core is for the corporations to take the lead in normalization to minimize damage to corporate value.
If corporations, when filing for rehabilitation, also request the ARS program, the court may issue a comprehensive injunction blocking creditors' compulsory execution and can defer the opening of rehabilitation proceedings for up to three months.
The court said, "Going forward, we will receive regular reports on the progress and status of consultations under the ARS," adding, "For fair and transparent proceedings, we plan to consider measures such as convening consultation dates if necessary."
Earlier, on the 26th, JR Global REIT disclosed that 40 billion won in bond principal and interest went unpaid and applied to the court to open rehabilitation proceedings.