S&P affirms SK Corp.

Standard & Poor's said it affirmed its ratings on SK Corp. (BBB-/stable) following the company's recent announcement that it will undertake a 10% share buyback, worth Korean won 863 billion, as well as an estimated W1 trillion in asset sales and ABS issuance.

The outlook remains stable.

The agency said it believes that the impact on the company's financial risk profile is limited since most of the required funds for the share buyback can be financed by asset sales, including plans to sell stakes in SK Incheon Oil, although there remains some concern over whether planned ABS issuance can fully transfer risk associated with to-be-securitized assets.

According to the agency, the rating on SK reflects its leading position in Korea's downstream petroleum market, extensive distribution and marketing network and favorable operating conditions with limited competition in the domestic market.

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