GS E&C to sell assets to ease cash shortage

2014-02-07 16:25

GS E&C to sell assets to ease cash shortage

By Yi Whan-woo
GS Engineering & Construction (E&C) plans to sell its luxury hotel operator to secure capital and ease a liquidity shortage, the company said Friday. Its debt ratio reached 276.9 percent last year.
The construction arm of GS Group is the biggest shareholder of Parnas Hotel with a 67.56 percent stake.
The builder said it included the operator of the Grand InterContinental Seoul Parnas and InterContinental Seoul Coex in Samseong-dong on its list of assets under consideration for sale.
“We’re open to selling all of our assets to secure liquidity, and Parnas Hotel is one of them,” a GS E&C spokesman said.
The country’s No. 8 builder estimated that the price of the Parnas Hotel could be as high as 1 trillion won.
GS E&C added that it is considering offloading two areas of land in Seoul currently used as sites for display homes. The estimated market value of the two tracts combined is 200 billion won, the builder said.
It also said it is considering issuing new stocks.
“A paid-in capital increase is under consideration although we have not decided when and how much we’ll increase it by,” GS E&C said.
The announcement came after the builder suffered an operating loss of 937.3 billion won ($871.74 million) in 2013.
Market observers said such losses will add to woes of GS E&C that has 520 billion won of corporate bonds due this year.

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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