Incumbent telco Korea Telecom Corp is planning a Swiss franc bond offering in order to refinance its existing debt. The size and terms of the debt financing have yet to be decided.
Net proceeds from the offering will be used principally to repay…
Incumbent telco Korea Telecom Corp is planning a Swiss franc bond offering in order to refinance its existing debt. The size and terms of the debt financing have yet to be decided.
Net proceeds from the offering will be used principally to repay existing debt maturing in early 2012, including the W100bn (US$88m) unsecured 4.37% 3-year notes that KT issued in May 2009. The remainder will be used for general corporate purposes.
Fitch Ratings has assigned the proposed Swiss franc bond an expected rating of ‘A(exp)’ in line with the company’s long-term foreign currency rating of ‘A’.
KT Corp, which is listed on the South Korean, US and UK stock exchanges, has been a frequent issuer in both the foreign and domestic bond markets, most recently with its W600bn (US$527m) triple-tranche domestic note offering in early 2010.
The company may be close to acquiring a 20% in South African fixed-line operator Telkom, after the two companies recently entered deal talks.
If an agreement is reached, Telkom will issue new ordinary shares at R36.06 (US$4.60) each.
Telkom has hired Deutsche Bank as lead financial adviser and transaction sponsor. Deloitte is acting as co-adviser and Eversheds as legal adviser.
The South African state holds 39.8% of Telkom and state-owned Public Investment Corporation controls 10.9%. The free float is of 47.3% and treasury stock 2%.
