Pantech Co., South Korea's No. 3 handset maker, is expected to file for a debt workout program later in the day to get back on its feet again amid a cash crunch, industry sources said.

The filing came some two years after Pantech was released in December 2011 from its five-year debt workout program.

Pantech trails after Samsung Electronics Co. and LG Electronics Inc. It once overtook LG Electronics in 2010 to become the country's No. 2 smartphone maker, thanks to strong sales of its Vega smartphone series.

The company started out as a small pager manufacturer. After it enjoyed early success as a handset maker, its shares were delisted in 2007 as debts increased and an acquisition of a local handset maker resulted in mounting losses.

The company was rescued through a massive cash injection and was put under the five-year debt rescheduling program in 2007.

But its financial footing has deteriorated recently as it struggled with falling sales from increased competition in the high-end smartphone market dominated by its bigger rivals and Apple Inc.

Its sales dropped 40 percent on-year to 1.07 trillion won ($999 million) in the first nine months of last year and suffered an operating loss of 245 billion won. (Yonhap)