S&P: SK unchanged

Standard & Poor's said, according to recent media reports, SK Corp. (BB+/positive) has been selected as the preferred bidder for Incheon Oil Refinery Co., which is currently under court receivership.

If the acquisition proceeded under current expectations, the purchase would be unlikely to have an effect on the rating on SK Corp. due to its cash reserves and strong cash flow generation.

"The rating on SK Corp. should not be impacted if the acquisition price is about Korean won 1.5 trillion, as has been reported in the media. The company has sufficient liquidity and financial flexibility to finance the acquisition, supported by its W414 billion in cash and equivalents, W270 billion in free cash flow at the end of June 2005 and good access to debt markets," said S&P credit analyst Eun Jin Kim.

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