This article was displayed on the ChosunBiz MoneyMove (MM) site at 4:47 p.m. on Mar. 25, 2026.
Shinsegae Development secured funding from financial institutions using assets such as the golf course, resort, and ski resort within Eden Valley Resort (Eden Valley CC) as collateral. Shinsegae Development, which has been undergoing corporate rehabilitation for more than two years, had repeatedly attempted to sell Eden Valley CC. The sales fell through time and again, 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 credit (LOC) for a loan worth 110 billion won from a syndicate composed of securities firms and capital companies. KB Securities is said to be the lead arranger. The interest rate is about 7% per year on an all-in basis, and the structure grants first-priority senior beneficial rights over the golf course, condominium, and ski resort within Eden Valley Resort.
In this fundraising, Golfzon, which signed a master lease agreement, effectively provided credit enhancement. If an event of default (EOD) occurs, Golfzon will make a subrogation repayment and will be allowed to acquire the golf course in an amount equivalent to the repayment, which reduced the syndicate's risk. In effect, the company raised 110 billion won with the golf course asset as collateral.
However, some say Shinsegae Development may be seeking to sell the golf course within Eden Valley Resort to Golfzon. Because this borrowing is a bridge loan with a two-year maturity, analysis suggests the disposition could take place with Golfzon making a subrogation repayment of 110 billion won. Although it takes the form of a loan, the structure is effectively coupled 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 reportedly won consent by raising creditor recovery rates and readjusting the repayment structure compared with before. For Geukdong Membership Loan, which holds collateral trust claims, the company increased the recovery rate by providing cash repayment and transferring 40 billion won in corporate bonds, while claims related to golf memberships were addressed through a debt-to-equity swap accompanied by facility-use discount coupons.
Shinsegae Development had been pursuing rehabilitation through the sale of Eden Valley CC. In the initial sale, potential buyers offered prices below expectations, causing the transaction to collapse, and a subsequent stalking horse process was halted due to the acquirer's funding issues. Last year, the company signed a contract worth about 120 billion won with Lamid Group, but the rehabilitation plan was voted down due to differences among creditors over recovery rates, and the deal ultimately fell through.
In rehabilitation proceedings, coordinating interests among creditors is a key variable. Even if the acquisition price is high, it is difficult to secure consent if recovery rates differ by creditor. In particular, for membership golf courses, uncertainties in the sale structure were significant as issues such as conversion to public play and the return of memberships became 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's master lease and subrogation repayment conditions appears to have secured recovery stability for financial institutions, making the fundraising possible.
Shinsegae Development, founded in 1991, is a comprehensive leisure company. Eden Valley CC is a complex facility that combines an 18-hole membership golf course, a ski resort, and a condominium.