Woongjin Group to resell water purification unit amid cash crunch

SEOUL, June 27 (Yonhap) -- Woongjin Group, a midsize conglomerate in South Korea, said Thursday it has decided to resell its water purification affiliate in order to improve the group's financial health.

The group said it plans to sell a 25.08 percent stake in Woongjin Coway, the nation's largest home appliance rental service provider.

This will be the second time that Woongjin Coway is up for sale.

In 2013, then cash-strapped Woongjin Group sold its 30 percent stake in Woongjin Coway to MBK Partners, a Seoul-based private equity firm, for about 1.2 trillion won (US$1 billion).

Woongjin Group decided to reacquire Woongjin Coway in October 2018 and took it over for some 1.9 trillion won.

But the group is facing a rating downgrade after the acquisition as the deal was 80 percent funded with loans.

The group is also moving to sell other assets to improve its financial status.

Woongjin Coway has been one of the cash cows for the group. The company had sales of 709.3 billion won and an operating profit of 135.2 billion won in the first half of the year, with net profit reaching 100.4 billion won.

kdon@yna.co.kr
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