10 Institutions Including KDB, Shinhan Bank, and NH Securities Participate
Shinsegae Group's negotiations to raise funds in the trillion-won range to repay SSG.com's investment are reported to have entered the final stage.
According to industry sources on the 20th, SSG.com is conducting final negotiations to complete a funding contract of about 1.2 trillion won with more than 10 domestic financial institutions. The senior investors, including KDB Industrial Bank and Shinhan Bank, are expected to invest about 780 billion won, which is 60% of the total amount, while the mezzanine investment securities firms such as NH Investment & Securities and KB Securities will take the remaining 420 billion won.
The investment period is three years, with an expected return rate of up to 5-8%. Shinsegae Group plans to use the funds raised this time to repay a total of 1.15 trillion won, including 1 trillion won of investment funds raised from private equity funds (PEF) Affinity Equity Partners and BR Capital, as well as settlement fees for contract modifications.
The scale of the funding has slightly decreased from the initially mentioned 1.4 trillion won. A Shinsegae Group official said, "It is not yet the stage to speak specifically about the contract," adding, "We are proceeding as we said, selling shares to new financial investors (FI)."
In June, Shinsegae Group announced that it had signed a contract for the sale of shares held by the Hong Kong-based private equity fund operators Affinity Equity Partners and BR Capital Management. The FI plans to sell all 1,316,492 common shares (30%) of SSG.com it holds to one or multiple third parties designated by E-Mart and Shinsegae by December 31 of this year. If the contract between Shinsegae Group and domestic financial institutions is finalized, the FI will recover more than the investment amount (1 trillion won) made in two rounds in 2019 and 2021.
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