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[Alpha Biz=(Chicago) Reporter Paul Lee] Korea Ratings announced on the 6th that it will maintain Ssangyong C & E's non-guaranteed bond credit rating as A and register it on the 'negative review' list.
Korea Ratings explained that Hahn & Company Cement Holdings, the largest shareholder, registered to reflect the expansion of the financial burden caused by the open purchase for the purpose of incorporating it into a complete subsidiary and the possibility of changes in dividend policy after delisting. Negative reviews are a type of rating monitoring (the prospect of credit rating changes within three months at most). It refers to a case where there is a possibility of a negative effect on future grades.
Of the total amount of 702.9 billion won needed for the open purchase of Ssangyong C & E, Ssangyong C & E and Han & Co Cement Holdings hold 155 billion won and 87.9 billion won in their own funds, respectively, and the insufficient funds will be raised through short-term borrowing. The procurement amount is 280 billion won for Han & Co Cement Holdings and 180 billion won for Ssangyong C & E.
Korea Ratings expects Ssangyong C & E's sequential deposits to expand to KRW 1.6 trillion through this open purchase. This will increase the debt ratio and increase the dependence on borrowings. In addition, the financial burden of Han & Co Cement Holdings, the largest shareholder, has expanded, and there is a possibility that Ssangyong C & E's dividend propensity may increase further to support the parent company's financial support.
Alphabiz Reporter Paul Lee(hoondork1977@alphabiz.co.kr)
