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Pantech chief appeals for support
Publication Date : 11-07-2014
The CEO of South Korea's third-largest handset maker, Pantech, pleaded on Thursday for support from telecom carriers and its creditors in a bid to save the struggling company.
“Pantech can be a viable company if mobile carriers agree to a debt swap and the company carries out its plan to normalise the management,” said Lee Jun-woo, CEO of Pantech, at a press conference at its headquarters.
The press conference comes with the country’s three telecom giants ― SK Telecom, KT and LG Uplus ― dragging their feet in participating in Pantech’s restructuring program despite the fact that they were given more time to consider the proposal from the creditors.
The creditors, led by state-run Korea Development Bank, said they would carry out a debt-to-equity swap worth 300 billion won (US$296 million). But according to the conditions, the three mobile carriers must chip in by agreeing to swap 180 billion won of funds Pantech owes them.
The Pantech chief executive apologised for the company’s management difficulties and appealed for support from mobile carriers and its creditors.
“We understand the proposal made by the creditors will require a tough decision from mobile carriers. But, we desperately plead for the positive consideration of the plan,” Lee said.
Lee also told creditors that “We hope you take stronger action to prevent Pantech’s debt work-out program from being suspended.”
If the three mobile carriers refuse to agree to a swap, Pantech will have to file for bankruptcy, he said. “The company is not yet in preparation for filing for receivership.”
“If Pantech goes into receivership, the company’s brand value will be diminished, and its partner companies may also go bankrupt,” the CEO said.
Regarding mobile carriers’ skeptical views on the company’s survival, he said that Pantech will be a viable company if it carries out a plan proposed by its creditors to normalise its management.
“Though the entire plan cannot be disclosed, we are confident that the company will see growing sales overseas in two years, and it can possibly be moved up a year,” he said.