이 기사는 2021년 10월 20일 08시08분 thebell에 표출된 기사입니다

South Korea’s largest wireless carrier SK Telecom plans to issue multi-tranche corporate bonds thanks to its strong presence in the market.

SK Telecom will hold its book building process on Wednesday for its multi-tranche 200 billion won ($169 million) bond offering, which includes three-, five-, and 20-year debts. SK Securities and Mirae Asset Securities are handling the offering.

SK Telecom’s planned non-telecom spin-off as SK Square on November 1 is heightening uncertainties of the company's business. The upcoming bond offering will be the last issuance before the spin-off.

The bond’s credit rating will remain the same because the companies will jointly be responsible for previously issued bonds. However, changes are likely after the spin-off, depending on each firm’s operating cash flow and borrowings.

Under the spin-off, SK Telecom’s stake in its chipmaking affiliate SK hynix, app market operator ONE Store, e-commerce platform 11Street and T Map Mobility will be transferred to SK Square. Accordingly, SK Telecom's financial buffer is expected to weaken in the short term. SK Telecom has invested about 6.5 trillion won in subsidiaries and joint ventures subject to transfer, including SK hynix.

The value of SK Telecom’s 20.1% stake in SK hynix will increase if the stake is revalued using an equity method instead of a cost method.

The stake in SK hynix has been valued based on its book value of 3.37 trillion won in 2012 when it was acquired by SK Group. If it is recognized as a market price of around 19.3 trillion won through the equity method, the value of SK Square, a newly established company, will increase whereas the value of the surviving SK Telecom will decrease.

SK Telecom’s net assets will increase from 17.19 trillion won to 26.16 trillion won if the market price is reflected in its stake in SK hynix. The amount that will be transferred to SK Square will also sharply increase from 6.93 trillion won to 15.8 trillion won. This means 60.4% of SK Telecom’s net assets will be transferred to SK Square, instead of 40.3%.

Meanwhile, SK Telecom will be left with most of the borrowings. The net borrowings remaining at SK Telecom after the spin-off is expected to reach 8.14 trillion won. A decrease in financial leverage seems inevitable along with a decrease in capital.

Instead, SK Telecom is expected to maintain its strong operating cash flow thanks to its traditional telecom businesses, including SK Broadband and SK Telink. (Reporting by Chan-mi Oh)