In a strategic move to resolve long-standing financial and legal hurdles, YJ, a subsidiary of the mid-sized Yeongjin General Construction, has been confirmed as the final buyer of the Gunwi Calrite Country Club (Gunwi CC).
The acquisition marks the conclusion of a complex rescue operation by Yeongjin, which served as the original contractor (Sigongsa) and debt guarantor for the 18-hole public golf course.
According to investment banking sources on January 2, the sale was finalized using the stalking horse method, a process where a preliminary buyer is selected before opening the deal to competitive bidding.
The acquisition structure involves YJ acquiring newly issued shares from the operator, Gunwi Country Club Co. Crucially, the deal includes the absorption of approximately 53 billion won in debt—funds that Yeongjin General Construction had previously repaid on behalf of the golf course through subrogation.
Under the terms of the rehabilitation, the equity of the previous controlling shareholder, Geumwoo Development, will be canceled without compensation. This action follows Article 205 of the Debtor Rehabilitation and Bankruptcy Act, which mandates equity cancellation when a controlling shareholder is deemed significantly responsible for the company's insolvency.
Gunwi CC’s financial downfall was rooted in a decades-old broken promise. While the course officially opened in 2022, its history dates back twenty years.
The local government originally permitted the conversion of agricultural and conservation land into a golf course under one strict condition: the establishment of a golf-specialized high school. When the operator failed to deliver on this commitment for two decades, authorities issued a suspension of land use, effectively paralyzing the business.
By filing for corporate rehabilitation as a creditor, Yeongjin General Construction aimed to clear the "contingent liabilities" and complex legal disputes surrounding the property.
To restore the course's full operating permits, the new owner, YJ, must now:
Founded in 1973, Yeongjin is a seasoned player in South Korea's infrastructure sector, with a portfolio spanning roads, ports, and luxury hotels. The company recently made headlines for winning the Gunsan Port embankment contract in a consortium with Dongbu Corporation. As of the end of 2024, the firm reported annual sales of 297.2 billion won.
Samil PwC acted as the sale adviser for this transaction.
