Restructuring of Five Chaebols through Work-out Programs

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Restructuring of Five Chaebols through Work-out Programs

The Financial Supervisory Commission (FSC) announced on December 4 that eight companies of five chaebols applied for work-out programs and two to three among them will be accepted.
A source at the FSC said, 'Work-out programs offered to the five chaebols are aimed at fortifying the competitive power of companies. So, insolvent companies will be ruled out. Chaebols should apply for work-out arrangements for their main companies'
The applicants are Hyundai Steel Pipe, Hyundai Petrochemical, Samsung Heavy Industry, Samsung Aviation, Orion Electronics of Daewoo, LG Information & Communications, LG Syltron, and Oxy Chemical of SK. The FSC revealed that companies which have good business prospect but high debt ratios will be eligible for the programs.
According to the FSC, loans to the five chaebols will be tolerated to improve capital but they cannot receive any financial support including favored interest rates. The management rights of chaebols will be guaranteed.
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