Hyundai Group plans rights offer for E&C buy

Hyundai Group plans rights offer for E&C buy
Comment E-mail Print Share
First Published: Mon, Dec 20 2010. 11 50 AM IST
Updated: Mon, Dec 20 2010. 11 50 AM IST
Seoul: Hyundai Group said on Monday that it is planning a multi-trillion-won rights issue via a group company to fund its $4.8 billion purchase of a 35% stake in Hyundai Engineering & Construction Co Ltd.
The rights offering announcement is Hyundai Group’s latest effort to shrug off concerns over its funding plans as Hyundai E&C creditors will decide by 22 December whether to end talks on the $4.8 billion sale.
“The rights issue, which will be part of our funding sources, is aimed at eradicating market fears over post-sale liquidity for both companies,” a Hyundai Group spokesperson said, declining to name the foreign investors the group was tapping.
With an offer of 5.5 trillion won ($4.76 billion), more than double the market value of E&C, Hyundai Group unexpectedly defeated Hyundai Motor Group last month in the bidding war.
Shipping-focused Hyundai Group could be on the verge of failing to reclaim ownership in the country’s largest builder as a legal adviser on the sale has said documentation submitted by group in support of its financing plans is insufficient.
Leading creditors of Hyundai E&C said on Friday that they may discuss whether to replace Hyundai Group with Hyundai Motor Group, parent of Hyundai Motor Co, as preferred bidder.
Shares in Hyundai Merchant Marine Co Ltd, through which Hyundai Group is pursuing the rights issue, were down 4.6% as of 09:00 am.
Comment E-mail Print Share
First Published: Mon, Dec 20 2010. 11 50 AM IST