Mobile carriers’ largess give Pantech a reprieve

Industry

Mobile carriers’ largess give Pantech a reprieve

Cash-strapped mobile device maker Pantech barely managed to pull back from the brink of bankruptcy as the country’s three mobile carriers decided to extend the grace period for the debt they are owed to two more years.

Pantech owes 180 billion won ($174.9 million) to SK Telecom, KT and LG U+.

SK Networks, the phone retailer of SK Telecom, made the decision at a meeting of its board of directors yesterday. KT and LG U+ followed suit.

But despite the deferred debt repayment, Pantech still has a long way to go before it normalizes its business. In order to stand on its own feet, it must sell 200,000 mobile devices every month, but it has 600,000 products already in stock at mobile carriers, so it is unlikely that the carriers will purchase more products from Pantech in the near futures.

The company earlier begged mobile carriers to carry out a debt-to-equity swap worth 300 billion won, but the carriers declined.