Moody's: No change to Posco

Moody's Investors Service said that Daewoo International Corp.'s announcement that it will sell its non-core investment, a 24% stake in Kyobo Life Insurance, for KRW 1.2 trillion will not change Moody's review for downgrade on Daewoo's parent Posco.

At the same time, the agency said it believes that the planned sale is a step in the right direction for the purposes of improving its financial position.

"Moody's believes that the transaction is an encouraging move. But the net proceeds of around KRW960 billion, if used to pay down debt, will only reduce Posco's debt/EBITDA by a marginal 0.13x. This reduction is not enough to improve its financial profile to a level consistent with its A3 rating," said Chris Park, a Moody's vice president and senior credit officer, in a news release.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.