Lotte Tour Development has fully repaid overseas convertible bonds (CB) worth 120 billion won.
Lotte Tour Development said on the 19th that it has repaid in full a total of 120 billion won, including the 60 million-dollar (about 84 billion won) sixth convertible bonds issued to overseas investors and 25.5 million dollars (about 36 billion won) in maturity interest.
With this repayment, Lotte Tour Development has succeeded in repaying or converting into shares 78% of the 336.6 billion won in total convertible bonds issued since 2013 during the development of the Jeju Dream Tower integrated resort. Accordingly, only 70 billion won (eighth tranche), maturing at the end of Nov., and 5.5 billion won (10th tranche), maturing next Aug., remain.
A Lotte Tour Development official said, "Of the 120 billion won repaid this time, apart from the 40 billion won loan secured by Jeju Dream Tower as collateral, 80 billion won was covered with cash on hand," and added, "Even if the annual 88 billion won in depreciation, which does not involve an actual cash outflow, is reflected as an accounting expense, net profit has turned positive since the second quarter, and surplus funds are accumulating quickly."
The official added, "With this repayment easing the overhang from issuing 5.12 million new shares, shareholder value has risen, and about 15 billion won in annual interest expense will also disappear, so we expect significant effects in removing uncertainty and improving profitability."