Korean e-commerce platform TMON is currently undergoing due diligence as it seeks to attract new investors amidst a liquidity crisis, industry sources revealed on Tuesday.
A local accounting firm has been assessing TMON’s financial health since Friday to determine its viability for potential investors, according to individuals familiar with the situation, who spoke to Yonhap News Agency.
On July 29, TMON and WeMakePrice, both Korean e-commerce companies owned by Singapore-based Qoo10, filed for corporate rehabilitation with the Seoul Bankruptcy Court after failing to pay merchants using their platforms since early July.
Since August 2, the two platforms have been participating in a one-month Autonomous Restructuring Support (ARS) program. This program allows them to attempt self-rescue efforts to secure investors and address overdue payments and other financial issues.
The ARS program is part of the court’s broader corporate rehabilitation framework. If the companies fail to present satisfactory self-help plans, they will be placed under a court-led debt rescheduling program.
TMON is preparing its transaction settlement system to resume sales on its online marketplaces, hoping to attract investors, a company spokesperson said.
“The most urgent matter is for credit card companies to allow customers to use their cards for purchases on the platforms,” the spokesperson added.
The payment delays from TMON and WeMakePrice have triggered an investigation by local financial authorities, who estimate more than 1 trillion won ($751 million) in unpaid bills and other liquidity problems.
Earlier this month, Ku Young-bae, the Korean founder and CEO of Qoo10, announced plans to merge TMON and WeMakePrice into a new business entity called the K-Commerce Center for World (KCCW), with an initial capital of 1 billion won.
Ku stated that Qoo10 will divest its entire stakes in both platforms, placing his entire 38 percent stake in Qoo10 under KCCW’s control.
The merger plan is pending approval from the bankruptcy court.
Additionally, on August 16, Interpark Commerce, another affiliate of Qoo10, also filed for the ARS program due to liquidity issues.