Court announces commencement of Eastar Jet rehabilitation procedure… Kim Yoo-sang to the manager

Input 2021.02.04 15:48 | Revision 2021.02.04 16:34

Eastar Jet, which applied for corporate rehabilitation due to worsening management difficulties, has entered the rehabilitation process. It has been about a month since the court issued a preservation disposition and a comprehensive injunction against Eastar Jet last month.

The Seoul Rehabilitation Court’s Rehabilitation Division 1 (Deputy Judge Seo Kyung-hwan, Jeon Dae-gyu, Senior Judge Kim Chang-kwon) decided to start the rehabilitation procedure for Eastar Jet on the 4th. Two managers were selected, including Kim Yu-sang, CEO of Eastar Jet.

On the 29th of last month, Eastar Jet’s pilots union asked the court to exclude the current management from the selection process of the rehabilitation process manager and review KTC Group Chairman Hong Jae-chang and former East-Star Airline finance manager Yang Dong-il as candidates, but it was not accepted.

The court asked Eastar Jet to submit a list of rehabilitation creditors, rehabilitation secured creditors and shareholders by the 18th. In addition, from the 19th to the 4th of next month, they are required to report rehabilitation bonds, rehabilitation security rights, and stocks. If you do not report your rights within this period, you may lose your rights.

Upon completion of the report, the court is expected to receive a rehabilitation plan from Eastar Jet by May 20 after going through an investigation period for rehabilitation bonds and rehabilitation security rights from the 5th to the 25th of next month.

The court said, “Anyone who owns Eastar Jet’s property or has a debt to Eastar Jet should not return it or pay off the debt,” and “he must report it to the manager by the 4th of the following month.”

Earlier, on the 15th of last month, the court ordered Eastar Jet to preserve property and a comprehensive injunction. Property preservation measures limit the debtor’s disposal of property, and the comprehensive injunction is a measure that completely prohibits forced execution such as auctions and seizure of the debtor’s property.

Eastar Jet has faced difficulties in promoting the resale of the merger and acquisition (M&A) with Jeju Air, which had been in progress since December 2019. Here, after suffering management difficulties due to the spread of coronavirus infection (Corona 19), he finally applied for a corporate rehabilitation procedure.