This article was displayed on the ChosunBiz MoneyMove (MM) site at 4:47 p.m. on Mar. 25, 2026.
Shinsegae Development secured financing from financial institutions by using assets such as the golf course, resort, and ski resort within Eden Valley Resort (Eden Valley CC) as collateral. Shinsegae Development had been pushing for the sale of Eden Valley CC while undergoing corporate rehabilitation for more than two years. The sale repeatedly fell through, but the company switched to a debt structure and obtained court approval for its rehabilitation plan.
According to the investment banking (IB) industry on the 25th, Shinsegae Development recently secured a letter of commitment (LOC) for a 110 billion won loan from a lender group made up of securities firms and capital companies. KB Securities is said to be the arranger. The interest rate is about 7% per year on an all-in basis, with a structure that grants first-priority senior profit rights on the golf course, condo, and ski resort within Eden Valley Resort.
In this financing, Golfzon County, which signed a master lease, effectively played a credit enhancement role. If an event of default (EOD) occurs, Golfzon County will make a subrogation payment, and the terms include the right to acquire the golf course for the corresponding amount, reducing the lender group's risk. In effect, the company raised as much as 110 billion won in funds with the golf course asset as collateral.
However, some say Shinsegae Development may be trying to sell the golf course within Eden Valley Resort to Golfzon County. Because this borrowing is a two-year bridge loan, analysis holds that the disposal would be carried out by having Golfzon County make the 110 billion won subrogation payment. Although it takes the form of a loan, the intent is that it is effectively a structure combined with a conditional acquisition option.
Shinsegae Development obtained court approval for a rehabilitation plan that includes debt repayment, based on the funds secured this time. The plan is said to have won consent by raising creditor recovery rates compared with before and readjusting the repayment structure. For Geukdong Membership Finance, which holds collateral trust bonds, the company increased the recovery rate by providing cash repayment as well as transferring 40 billion won in corporate bonds, and for claims related to golf memberships, it applied a method that combines a debt-to-equity swap with facility-use discount coupons.
Shinsegae Development had been pursuing rehabilitation through the sale of Eden Valley CC. In the initial sale, bidders offered amounts below the expected price, causing the transaction to collapse, and a subsequent stalking-horse deal was halted due to the acquirer's financing issues. Last year, the company signed a contract worth about 120 billion won with Ramid Group, but the rehabilitation plan was voted down amid differences among creditors over recovery rates, and the deal ultimately fell through.
In rehabilitation proceedings, aligning creditor interests is the key variable. Even with a higher acquisition price, it is difficult to secure approval if recovery rates differ by creditor. In particular, for membership golf courses, uncertainties in the sale structure were significant because the public conversion and membership refund issues were intertwined.
This time, however, the company raised funds by setting collateral without disposing of assets and dispersed losses by combining cash repayment and debt-to-equity swaps for creditors. In particular, the combination of Golfzon County's master lease and subrogation payment conditions appears to have made the financing possible by ensuring recovery stability for financial institutions.
Shinsegae Development is a comprehensive leisure company established in 1991. Eden Valley CC is a complex that combines an 18-hole membership golf course, a ski resort, and condos.