Pantech’s another false hope?
Pantech’s another false hope?
  • By Yeon Choul-woong (info@koreaittimes.com)
  • 승인 2015.06.18 02:04
  • 댓글 0
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Pantech, which applied for the end of court receivership, appeared to meet a lifesaver – a consortium led by a local optical instrument Optis, according to multiple local media outlets on Tuesday.

However, both Pantech and market watchers are rather cautious as the local firm already had several experiences of deal failures.

According to market watchers, the consortium led by Optis submitted the take-over application to a court around 10 days ago, a week after Pantech applied for the end of court receivership.

Unlike other candidates, Optis already paid around 2 billion won under the pretext of performance bond, 5 percent of total take over deal.

If all things go well, the Optis consortium is expected to have due diligence this month and sign a deal on July 17th.

Still, Pantech is very cautious about this deal as it has experienced similar proposal for several times, declining to make official comments.

An analyst declining to be identified said, “The Optis consortium submitted detailed plan suggesting that research and development is would be done in Korea while production is made in Indonesia.”

With the deal making headlines in local media outlets, the leading company of the consortium Optis became the focus of the public attention.

Optis is a manufacturer of optical disk drive set up by Lee Joo-hyung, formerly working for Samsung Electronics. The company bought a 49.9 percent stake of Toshiba Samsung Storage Technology last year, and is expected to buy a 100 percent stake by 2017. Its sales stood at 599.6 billion won last year, with operating profits of 15 billion won.

Optis, which focused on optical disk drive, expanded its business into auto focus actuator for camera modules. It bought AFA manufacturing plant owned by Sankyo and moved it the Philippines.

Pantech, Korea’s third largest smartphone maker, was set up in 1991. It once took the lead in the local smartphone market with the stylish brand Sky. However, due to strict regulations in the domestic market and the difficulty to make forays into global markets, the company has continued to lose its profits and eventually applied for court receivership last March.

Pantech has been under court management since last August and it applied for the end of court receivership on May 26.

Announcing the end of receivership, Pantech’s chief said, “We applied for the end of court receivership as we are not able to stand as a companyy."

“We will try our best to minimize the inconvenience of consumers using our products,” he added.

There were several forays to buy the company so far but all went up in failure mostly because the companies participating in the bidding were not fully qualified. Hours before the new bidding news, Pantech closed its services - appstore “Applsplay” and N-screen service “Vega Live” – were ended on Tuesday.

“We feel sorry that the services are abruptly closed. When Vega Live revives, we will return to you,” Pantech left a short message.

Before the emerence of Optis, Pantech appeared to give up everything with the three consecutive attempts to buy the firm turned out to be failures. Los Angeles-based One Value Asset Management showed strong willingness to make the local smartphone maker “Post Xiaomi” but end up leaving. As the cash-strapped company found no other way to survive and applied for the end of court receivership recently.

If the deal again fails, Pantech’s creditors will have the rest of assets based on the Bankruptcy Law. According to a financial watchdog, Pantech’s asset of last year stood at 268.3 billion won with a debt of 996.2 billion won.


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