Korea Express paves the way for self-rescue

Korea Express, the largest logistic company in Korea, will depart from Dong-A Construction Co., and go its own way.

Korea Express received permission to restructure from the Seoul Regional Court Bankruptcy Department, establishing a framework for self-rescue.

The Seoul Regional Court Bankruptcy Department approved the reorganization plans on June 12, which Korea Express submitted with an agreement from creditors.

It netted 15.4 billion won in ordinary profits by May, 60 percent of last year's whole profit, under the court's receivership. It is expected to achieve 30 billion won by the end of this year.

Its reorganization plans contained provisions to repay 428.5 billion of its main debts of 546.9 billion won, while 350 billion won out of 919.2 billion in surety ship obligations will be liquidated. 271.3 billion won will be turned into capital reduction, and 416.3 billion won will be written off as a loss. Shares will be set at 25,000 won, depending on mortgages.

The return period will be deferred for three years and repaid by installment over seven years for mortgaged assets. Other debts will be deferred for four years and repaid by installment over six.

As the court permits its reorganizing plans, mergers and acquisitions will be active, which have so far been delayed due to the uncertainty of their debts.