This article was published on Feb. 25, 2025, at 4:56 p.m. on the ChosunBiz MoneyMove website.
Domestic private equity fund operator IMM Credit Solutions (hereafter ICS) will acquire 300 billion won in exchange bonds (EB) issued by HD Korea Shipbuilding & Offshore Engineering, targeting shares of HD Hyundai Heavy Industries.
According to the investment banking (IB) industry on the 25th, HD Korea Shipbuilding & Offshore Engineering decided to issue 600 billion won in EB based on its ownership of HD Hyundai Heavy Industries shares to secure funding for an overseas shipyard acquisition. NH Investment & Securities and a special purpose company (SPC) Cube P&I created by NH Investment & Securities will purchase 150 billion won worth each.
The maturity of the EB is March 28, 2030. Both the maturity interest rate and the coupon rate are 0%. Investors can only expect capital gains through the exchange of shares. The EB exchange price is 346,705 won, which is 12.56% higher than the closing price of 308,000 won for HD Hyundai Heavy Industries on that day. Both ICS and NH Investment & Securities appear confident in the rise of HD Hyundai Heavy Industries' stock price.
HD Korea Shipbuilding & Offshore Engineering holds a 75.2% stake in HD Hyundai Heavy Industries. The stock price of HD Hyundai Heavy Industries rose significantly last year, suggesting that this strategy was implemented. HD Hyundai Heavy Industries increased by more than 130% last year.
As of that day, the market capitalization of HD Hyundai Heavy Industries is 27.3421 trillion won. From the perspective of HD Korea Shipbuilding & Offshore Engineering, merely offering 2.19% of its equity will enable it to secure 600 billion won.
An official from HD Korea Shipbuilding & Offshore Engineering noted, “The secured funds will be used for research and development in hydrogen fuel cells, small modular reactors (SMR), and offshore wind power.”