Restructuring Hit List

 

UAMCO is planning to pick up to 10 Korean corporations as restructuring targets next year with the Financial Supervisory Service and the Financial Services Commission. Five of them or so are likely to be included in its first private equity fund for corporate restructuring.

Candidates are expected to be selected from mid-sized enterprises, each with an equity capital of 100 to 200 billion won (US$85 to $170 million) and currently in voluntary agreements. The list of candidates also includes firms in workout programs. At present, more than 100 Korean companies are in corporate restructuring processes based on voluntary agreements or workout programs, and banks recently carried out credit risk assessments to add 70 or so to the category.

UAMCO is planning to focus on the possibility of a turnaround above anything else. The eight shareholder banks investing in the corporation and corporate restructuring experts have formed a team to look into the candidates. Not all the targets are guaranteed to survive, though.

UAMCO is going to liquidate those lazy in reforming themselves at any time. “We assume that we can purchase bonds and stocks of restructuring targets worth up to 28 trillion won [US$23.9 billion] next year, on the condition that the shareholder banks increase their investment in and loans for us,” it explained.

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