Truck Firm Files For Bankruptcy

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Truck Firm Files For Bankruptcy

Samsung Commercial Vehicle Co., the truck-making unit of the Samsung Group, on Friday filed for bankruptcy, ending a turbulent four years during which the firm was unable to get off the ground.

In documents presented to the Taegu District Court asking for its assets to be frozen, the motor company claimed it had suffered a total of 450.2 billion won ($379 million) in accumulated losses since it was founded and its own capital of 440 billion won has been completely wiped out.

Samsung said that its business was harmed by sluggish domestic demand during the economic crisis in late 1997 and 1998. The company tried to raise 340 billion won in new capital and sought foreign investment last year, but to no avail. In addition, Samsung said, lenders had stopped providing new loans.

The court will decide the fate of the carmaker after reviewing the documents Samsung submitted and will freeze its assets, if necessary.

If the court declares the truck maker bankrupt, a court-appointed trustee will distribute the firm's assets to creditors.

Established in 1996, Samsung had total assets of 643.84 billion won, compared with total liabilities of 655.65 billion won as of October.

On Nov. 3, Samsung Commercial Vehicle's creditors put it on a list of insolvent companies marked for closure or receivership.

by Hong Gweon-sam

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