Korean telecom giant KT to issue $400 mn dollar bond in August

South Korea’s telecom giant KT Corp. plans to raise $400 million by issuing a dollar-denominated bond around the end of August, according to investment banking industry sources on August 11.

It will be the first time this year for the company to issue an overseas bond. KT will use the funds to repay borrowings.

Securing enough subscriptions may not be too challenging for KT now, as bond markets have softened up since the turbulence of a few months ago, when the US Fed decided to buy corporate bonds alongside major countries rolling out robust liquidity measures.

Recently, a number of Korean private companies, including Doosan Infracore, GS Caltex, and Mirae Asset Daewoo have all been successful in issuing foreign currency bonds.

Standard Chartered Securities, Citigroup Global Market Securities, Credit Agricole, BNP Paribas, and HSBC are joint bookrunners.

KT posted 724.9 billion won ($611 million) in operating profit during the first half of this year, marking a 5.0% year-on-year increase. The quarterly results are in contrast to many other companies that have suffered poor earnings due to the impact of the coronavirus.

The company’s global credit rating stands at A- based on Standard & Poor’s, making it one of the few private Korean companies with an A-level investment grade.

At home, the telecom giant’s stable earnings led to overwhelming demand for its new debt during the bookbuilding in June. At the time, KT received subscription demands worth 1.45 trillion won, seven times higher than the offering amount of 200 billion won. KT then increased the offering to 300 billion won in response to overheated subscription demands.

Write to Jin-sung Kim at jskim1028@hankyung.com