A court has approved JTBC's application for the Autonomous Restructuring Support (ARS) program and postponed its decision on whether to commence rehabilitation proceedings.
The Seoul Bankruptcy Court's 2nd Rehabilitation Division (Presiding Judge Jung Joon-young) announced today (June 30) that it will hold off on deciding whether to initiate rehabilitation proceedings until July 30 to monitor the progress of JTBC's ARS negotiations.
The ARS is a program in which the court postpones the commencement of compulsory rehabilitation proceedings to support a company and its creditors in negotiating restructuring autonomously.
The court can postpone the commencement of rehabilitation proceedings for up to three months, and this period can be extended further if there is significant progress in negotiations.
If an agreement is reached with creditors within the postponement period, JTBC will withdraw its rehabilitation application and implement its planned ARS measures.
If negotiations fail, the court will then decide whether to proceed with the rehabilitation process.
In that case, the court will begin an investigation to evaluate the circumstances that led to JTBC's need for rehabilitation, as well as its asset value, going-concern value, and liquidation value.
On June 12, JTBC declared a default after failing to repay 20.6 billion won in securitized borrowings upon maturity.
Two days later, on June 14, JoongAng Holdings, Contentree JoongAng, JoongAng P&I, and Megabox JoongAng filed for rehabilitation one after another, leading to what is being called the "JoongAng Group rehabilitation crisis."
On June 15, JTBC also filed for rehabilitation and expressed its intention to participate in the ARS program.