South Korean telco SK Telecom plans to issue A$300m (US$317m) bonds, to be drawn from the US$3bn global medium-term notes programme it announced in October.
The Australia-denominated senior unsecured bonds were assigned an ‘A-’ rating by Standard &…
South Korean telco SK Telecom plans to issue A$300m (US$317m) bonds, to be drawn from the US$3bn global medium-term notes programme it announced in October.
The Australia-denominated senior unsecured bonds were assigned an ‘A-’ rating by Standard & Poor’s today.
“Our ratings on SKT reflect the company’s leading position in Korea’s wireless telecommunications market; its strong business risk profile, backed by strong, stable operating cash flow; and its modest financial risk profile,” said the ratings agency.
“At the same time, our ratings take into account intense competition in the mature domestic market, uncertainty in the regulatory environment, and SKT group’s aggressive growth strategy.”
As TelecomFinance previously reported, SK Telecom’s US$3bn notes programme was the second programme it had registered in weeks, as the company is looking to reduce its high levels of debt.
SK Telecom has over 50% share of the Korean wireless market and a growing fixed-line business through its subsidiary SK Hynix. However, the primarily debt-funded acquisition of a 21% stake in the subsidiary was thought to weaken the company’s financial profile and Standard & Poor’s today said that a “material increase in SKT’s ownership or capital investment in Hynix” could pressure their ratings on the telco.
