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Biz News Korea(Eng)

S. Korea’s E-land’s credit rating downgraded and warned of further cut

Collected: 2016.04.09

Distributed: 2016.04.11

Source: Go Direct

Darkening its prospects for an initial public offering in China and sale of its big-box store chain, South Korean rating agencies are poised to downgrade Korean fashion group E-land Group’s debt ratings and their outlook, citing concerns for deteriorating financial conditions.

Korea Ratings Corp. slashed the credit rating of E-land Park, the conglomerate’s restaurant and leisure unit, from BBB to BBB- while turning from stable to negative on the BBB+ debt outlook for E-Land World and E-Land Retail. The agency also lowered E-land Retail’s commercial paper (CP) rating to A3+ from A2-.

Another rating firm NICE Investors Service Co. also questioned E-Land Group`s affordability to repay debt amid deteriorating retail business conditions in China and Korea. It warned that the group could see downgrade on its debt unless it secures sufficient cash and improves liquidity fast.

E-land is trying to raise capital through sale of big-box store chain Kim’s Club and New Core department store in southern Seoul, as well as a pre-IPO placement ahead of going public in China. NICE said the group needs at least 1.6 trillion won ($1.4 billion) to put business back on solid grounds.

By Kim Hyo-hye

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