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Dayou Winia unloads golf course to ease liquidity crunch
Dayou Winia Group Chairman Park Young-woo attends a National Assembly audit in Yeouido Seoul, Oct. 26. Yonhap
By Lee Kyung-min
Cash-strapped Dayou Winia Group has found a breakthrough after suffering from a liquidity crisis for years, buoyed by the selloff of Monvert Country Club in Pocheon, Gyeonggi Province, to Dongwha Group, according to market watchers, Friday.
The 300 billion won ($227 million) deal will translate into about 100 billion won cash, most of which will be used to pay over 55.3 billion won in back wages to Dayou employees and the redemption on Nov. 30 of 40 billion won in convertible bonds of Dayou A-Tech, the group’s car seat manufacturing affiliate. The remaining amount will fortify its affiliates’ financials and management operations. Also, to salvage the group’s reeling corporate operations is a planned selloff of the 21-story Dayou Winia Tower research and development center in Seongnam, Gyeonggi, for 130 billion won.
Monvert Country Club / Courtesy of Monvert Country Club
According to market watchers, Dayou Group signed a deal to sell the country club to Dongwha MPARK, a used car trading subsidiary of Dongwha Group. The down payment for the deal is believed to be 60 billion won.
The initial purchase price stood in the mid-300 billion won range, mostly because the golf course had obtained a permit to build seven additional holes.
But Dayou agreed to a lower figure, conditional upon making an immediate payment.
Dayou acquired the 36-hole golf course for 37 billion won in 2011 and has since been under the management of group chair Park Young-woo.
Dayou group’s yearslong struggle took a major turn for the worse in April of last year when Winia Electronics, its electronics subsidiary, was unable to pay workers.
According to the Seongnam branch of the Ministry of Employment and Labor, 189 complaints were filed against the the electronics subsidiary between April 1 of last year and March 10 over unpaid wages and severance pay. Over 1,714 employees were unpaid. Most of the cases were referred to the prosecution.
Winia’s sustained poor performance long predated the group’s acquisition of the electronics firm in 2018, as amplified by crashing demand for consumer appliances during the COVID-19 pandemic years. Rapid increases in borrowing rates thereafter did little to help it regain ground.