[이코노미스트 김설아 기자] Mid-sized construction company ‘HN Inc’, the construction company of the apartment brand ‘Hyundai Sun & Ville’, entered court receivership. This company is the largest shareholder of Jeong Dae-seon, the third generation of the Beom-Hyundai family and the husband of former announcer Noh Hyun-jung.
In the industry, it is believed that the financial market crunch due to the housing transaction slump and the increase in unsold homes hastened H&INC’s rapid financial difficulties. In addition, as controversy over poor construction grows and lawsuits are added in the process of physical division, management seems to be on a deteriorating trend.
In the unsold disastrous… Move-in delays and poor construction controversies
According to the construction industry, H&INC, which recently applied for corporate rehabilitation at the Seoul Rehabilitation Court, has suffered from serious financial difficulties as liquidity was blocked due to the economic recession and real estate PF crisis. In particular, it is analyzed that the unsold unsold terrace house ‘Sokcho Heriot THE228’, which was sold in Jangsa-dong, Sokcho-si, Gangwon-do in August last year, became a direct hit. The complex suffered a crushing defeat with 119 households falling short of the 214 districts recruited. The ambiguous location away from the city and the lack of surrounding infrastructure caught up with it.
To make matters worse, the brand image was greatly damaged as controversy arose over delayed occupancy and poor construction. The residential and commercial building ‘Dongtan Station Heriot’, which was recently completed in Dongtan New Town, Hwaseong, was initially scheduled to move in on October 30, 2022, but the scheduled move-in date was delayed to January 20 this year due to disruptions in raw material supply and demand and union strikes.
During this process, suspicions of poor construction arose as the developer and the builder unreasonably accelerated prior inspection and move-in, and residents complained of insensitivity to safety and applied for more than 10,000 collective complaints to the city of Hwaseong.
An official from the industry said, “Since last year, there has been a liquidity problem due to unsold sales at the business site, and I understand that the financial crisis has rapidly worsened.”
Don’t use the ‘modern’ name… Lenders and litigation
H&INC is a mid-sized construction company ranked 133rd in the subcontracting ranking. As of 2021, annual sales were KRW 283.7 billion and net profit was KRW 3.6 billion. It was established in 1995 as YuC Tech, and changed its name to BS&C in November 2008 as Jung Dae-seon acquired a 100% stake in the company.
Since 2009, the corporate name has been changed to ‘Hyundai BS&C’, but in 2017, after losing a lawsuit filed by Hyundai Motor Group not to use the ‘Hyundai’ brand, it was changed to the current name in January of last year. Hyundai Motor Group’s position at the time was that it was difficult to recognize a company that had no organizational, economic, or equity relationship with the Pan-Hyundai Group as an individual group or affiliate that made up the Pan-Hyundai Group just because the largest shareholder was Jeong Dae-seon.
H&INC has also been in the information technology (IT) business, but in December of last year, in order to improve its financial structure, it carried out a physical division to split the company into construction (H&INC) and IT (new corporation H&IX) divisions. did. Afterwards, in the name of attracting investment, Beom-Hyundai sold about half of its stake in HNIX, a new corporation, to an affiliate for about 20 billion won.
However, in the process, a lawsuit with the lender (a group of lending financial institutions) arose. The large stockholders have filed a lawsuit to invalidate the division, claiming that the company was divided without the prior consent of the creditors.
Meanwhile, the Seoul Rehabilitation Court plans to review the application for preservative disposition and the application for a comprehensive injunction submitted by the company on the 21st and decide whether to accept it. This process is known to take about a week.
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