The court accepted JTBC's application for the Autonomous Restructuring Support (ARS) program. As a result, the decision on whether to open rehabilitation proceedings for JTBC will be put on hold until Jul. 30.
The Second Bankruptcy Division of the Seoul Bankruptcy Court (Presiding Judge Court President Jung Jun-young; reporting judge Senior Judge Hong Jun-seo) on the 30th accepted JTBC's application to defer the decision on whether to open rehabilitation proceedings.
On the 23rd, the panel held a representative examination hearing and heard JTBC's desired autonomous restructuring details and future plans. It then decided to defer the decision on whether to open rehabilitation proceedings that day to observe the status of ARS consultations.
ARS is a system in which the court postpones a decision to open rehabilitation proceedings for the time being and supports corporations and creditors in voluntarily discussing repayment plans and other matters. The focus is on allowing corporations to take the lead in normalization to reduce damage to corporate value that could result from the commencement of rehabilitation proceedings.
ARS is a stage prior to the commencement of rehabilitation proceedings. At this stage, creditors' or shareholders' rights are not diluted or impaired as in the process of approving a rehabilitation plan. If consultations proceed smoothly, the parties can sign an autonomous agreement and withdraw the application to commence rehabilitation proceedings.
The initial deferral period is one month. Depending on the consultation status, it can be extended by an additional two months, allowing the decision to commence rehabilitation proceedings to be postponed for up to three months. If consultations break down, the court will decide whether to commence rehabilitation proceedings.
Among the five JoongAng Group affiliates that applied to commence rehabilitation proceedings with the Seoul Bankruptcy Court on the 14th to 15th, JTBC is the only one that applied for ARS.
JTBC failed to repay at maturity a total of 20.6 billion won in securitized borrowing fund on the 12th, entering a state of debt default. Subsequently, on the 14th, JoongAng Holdings, Contentree JoongAng, JoongAng P&I, and Megabox JoongAng applied to commence rehabilitation proceedings. JTBC also applied to commence rehabilitation proceedings on the 15th and expressed its intention to pursue the ARS program.