이 기사는 2020년 05월 27일 08:00 thebell 에 표출된 기사입니다.

Deco & E Co., South Korea’s clothing manufacturer, has been put up for sale.

Deco & E has recently hired Samil PwC to manage its sale process and reported the situation to the Seoul Bankruptcy Court, sources familiar with the matter said on Monday. The Seoul Bankruptcy Court has begun the rehabilitation process for the company in November 2019.

Deco & E, which owns fashion brands including Deco, Ana Capri, EnC and 96NY, was listed on South Korea’s secondary Kosdaq market in 1993. Ten years later, E-Land Group acquired a 40 percent stake in the company for 10.7 billion won ($8.67 million) in 2003.

Yet, E-Land Group sold the company to a consortium consisted of Imagine Asia, formerly Wellmade Yedang, and MSTeam Entertainment in 2014. After the transaction, the company has changed hands several times and during the process, some brands including EnC were sold to new owners like E-Land Group.

Market watchers said that the company’s largest shareholder was changed too frequently to stably manage the company. Deco & E has been under pressure to redeem convertible bonds despite current largest shareholder Starcamp 202’s five billion won capital expansion. Deco & E, whose financial statements have received a disclaimer opinion from an auditor since 2018, was delisted from the stock market last year.

The liquidation value of Deco & E stood at approximately 12.2 billion won, lower than the going-concern value of 17.8 billion won as of November 2019, according to ANSE Accounting Corporation. Deco & E initially prepared a rehabilitation plan but ended up putting it up for sale due to headwinds like the Covid-19 outbreak.

The company is likely to draw interest from strategic investors in the clothing industry thanks to the solid brand loyalty and strong presence in the women’s apparel sector.

The sale manager Samil PwC is expected to set a timeline for the sale process in the near term. The final bid is likely to take place either in July or August after announcing the sale of the company and receiving letters of intent. Deco & E is likely to find a new owner by the end of this year.

(Reporting by Ik-hwan Choi)