Creditors of ailing South Korean handset maker Pantech have approved a “grace period” for the repayment of its debts, although this may still not be enough to save the company.
The vendor had already agreed to pay off its debt gradually, when its creditors pushed back a deadline for repayments, interest free, according to reports. But more sceptical observers have noted that this alone may not be enough to save Pantech.
The ailing vendor said that its future is subject to whether the country’s operators buy more devices, The Chosunilbo said.
According to the paper, local operators already have around 500,000 unsold Pantech devices in their warehouses, which would have to drop dramatically for the device maker to see a positive cash flow. But the operators are also unlikely to want to agree to more purchases while they have unwanted devices in the warehouse.
It has been suggested that Pantech may be an acquisition target, but with its precarious financial position and relatively small presence in its home market and the US, it is not clear who the buyer would be. Indian device maker Micromax, which has been linked with a deal, is reportedly not “enthused” by the prospect.
Qualcomm and Samsung both have stakes in Pantech, but are believed to be looking at the door.
The Korea Times said that an official with Korea Development Bank, which is owed money by Pantech, said: “There won’t be additional help”.