Daewoo E&C Issues 110 Billion KRW Corporate Bonds for Refinancing... Successful Low-Interest Funding up to 5 Years

Daewoo E&C Euljiro Headquarters

Daewoo E&C announced on the 1st that it has refinanced 110 billion KRW out of its 240 billion KRW corporate bonds (44th issuance) with a 2-year maturity. This is the first corporate bond issuance this year and was raised entirely through private placement. The remaining 130 billion KRW will be repaid using existing funds.

The corporate bonds to be issued this time (49th issuance) have maturities ranging from 3 to 5 years. Considering the existing investors' requests for maturity extension and the company's need to issue long-term bonds, the maturity was extended from the previous 2 years to a maximum of 5 years. The issuance interest rate was set lower than the market average rate. Given that private placement bonds are usually issued by adding a private placement premium to the market average rate, this is regarded as a successful issuance.

A Daewoo E&C official said, "Issuing 5-year corporate bonds is rare for A- grade companies and the construction industry, and it is meaningful that the private placement bonds were issued at an interest rate lower than the market average rate."

Currently, the total amount of corporate bonds issued by Daewoo E&C that have not yet matured is 601.7 billion KRW. Of this, 340 billion KRW must be repaid this year. Daewoo E&C plans to monitor market conditions and repay the funds at an appropriate time through public bond issuance, among other methods.

In the 2020 business performance announced on the 28th of last month, Daewoo E&C achieved an "earnings surprise" with sales of 8.1367 trillion KRW and operating profit of 558.3 billion KRW. Sales were at a similar level compared to the previous year, but operating profit increased by 53.3%. New orders during the same period also increased by 30.8% (13.9126 trillion KRW).

As of the fourth quarter of last year, Daewoo E&C's debt ratio decreased by 41.9 percentage points year-on-year to 247.8%. Net borrowings decreased by 411.7 billion KRW.

This content was produced with the assistance of AI translation services.