An increasing number of South Korean creditors are advocating the necessity of new ways of
corporate restructuring as the existing method characterized by voluntary agreements led by state-run banks is showing its limitations.
The existing method, which was brought in about 15 years ago, is for a restructuring target to try to go back to normal under the supervision of a creditor in the framework of a private agreement that has no legal binding force. STX Offshore & Shipbuilding is a typical example of how money-consuming voluntary agreements are. This company went into receivership in 38 months in spite of its voluntary agreement that provided no less than 4.5 trillion won. The voluntary agreements of Dongbu Steel and DK Aztec have fa…
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