이 기사는 2021년 10월 21일 08:04 thebell 에 표출된 기사입니다.

South Korea’s Doosan Engineering & Construction has raised 2.7 billion won ($2.3 million) through a short-term bond issue almost a year after its commercial paper sale last year, a sign that the company is recovering from financial distress.

The bond, which was issued electronically, matures on January 14, 2022. Doosan E&C can issue additional notes with a total limit of 50 billion won due in one year.

The company returned to the debt market almost a year after it completed a 40 billion won commercial paper issue at an interest rate of 7.3% in the private placement market in October 2020.

“We resumed bond issuance on the back of improved financial performance and positive investor sentiment,” said a Doosan E&C official.

Doosan E&C has focused on improving its financial position in the past year, with its net debt reducing from 629 billion won at the end of 2019 to 131 billion won at the end of 2020 and further to 60.5 billion won at the end of June this year. The ratio of total borrowings to total assets also fell from 29% at the end of 2019 to 12% at the end of June 2021.

The improvement was largely driven by the company’s restructuring. Doosan E&C split off its bad debt portfolio as a separate entity, ValueGrowth, in June 2020 as part of restructuring efforts by the broader Doosan Group, and secured 80 billion won by selling part of its stake in the subsidiary to Doosan Cuvex.

Additionally, Doosan E&C disposed its stakes in two subsidiaries of its own by merging them with Doosan Mecatec in December 2020, resulting in a decline in the building company’s debt level on a consolidated basis.

Doosan E&C is also benefiting from rising housing prices, with the company’s strong earnings growth driven by its residential property business. While its first-half revenue of 619 billion won was down 26% year-on-year on a consolidated basis, an operating profit soared 706% to 41 billion in the same period.

The company’s future prospects are positive with a strong order book. “Doosan E&C’s revenue grew to 1.8 trillion won in 2020 driven by housing construction. The company has a stable revenue base with 6.6 trillion won in orders as of June 2021,” Korea Ratings said in its recent report.

Its improved financial position is likely to help the company find a buyer. Doosan E&C recently restarted a process to sell itself and is said to be in talks with Shinyoung Securities about a possible sale. (Reporting by Jeong-wan Lee)