Bankruptcy Protection
According to Bloomberg on Oct. 17 (local time), Korean mobile phone manufacturer Pantech filed an application for bankruptcy protection in a U.S. court.
Pantech, under the sales process in Seoul, submitted an application for bankruptcy protection of its US$1 billion in debt and US$500 million assets to the U.S. Bankruptcy Court in Georgia.
Based on Chapter 15 bankruptcy protection, the section of the US Bankruptcy Code that deals with international insolvencies, companies can request the U.S. government to acknowledge the decision on receivership held in foreign countries.
If this request is accepted, Pantech will be under the management of U.S. Bankruptcy Court.
Regarding this application, Pantech said, “As the legal management started in Korea, we filed for this application to cancel other related lawsuits currently in progress in the U.S. There will be no separate process for receivership through the U.S. Court.”
Pantech, under serious financial difficulties, filed for legal management to Seoul Central District Court last August, and the Court decided to start the reorganization procedures.
Samjung KPMG, which received letters of intent for acquiring Pantech from domestic and overseas companies earlier this month, will start the bidding process on Oct. 29 at the earliest.