The Korea Times

HDC to suffer downgrade risks in credit, ESG and brand power

Former HDC Hyundai Development Company CEO Chung Mong-gyuBy Lee Kyung-min HDC Hyundai Development Company, a scandal-tainted construction affiliate of HDC Group, is facing growing downgrade risks in its credit and environmental, social and corporate governance (ESG) ratings and a rapid overall deterioration in brand value, according to Korea's three credit rating agencies.The collective opinion is the latest in the fallout after seven casualties occurred at an apartment complex under construction in Gwangju, a fatal collapse that the investigative authorities concluded had resulted from the firm's poor supervision of safety standards.Corporate profit, they say, will be significantly dented by a sharp deterioration in brand value and subsequent dive in advance orders of apartment construction, compounded further by shaky financial soundness due to lingering penalty risks brought on by questionable safety management protocols. The three ― Korea Ratings, NICE Investors Service and Korea Investors Service ― are considering downgrading the credit rating of the Hyundai affiliate.NICE Inves

Jan 28, 2022By Lee Kyung-min

Tech & Science

ICT minister hints at delay of 5G spectrum license auction

Science and ICT Minister Lim Hye-sook speaks during a press conference at the Sejong Government Complex, Thursday. YonhapBy Lee Kyung-min An auction for 5G spectrum licenses in the 20MHz bandwidth range scheduled for next month may not proceed as planned, the science minister indicated Thursday, further extending the yearlong tussle among the country's three wireless telecommunication operators ― SK Telecom, KT and LG Uplus. This comes amid a fierce three-way competition over service quality including speed and connections, determined largely by both the 5G spectrums bought by the telecommunications operators and how close their newly acquired 5G spectrums are to their existing bandwidths.SK Telecom, the market leader, and KT say pushing ahead with the original schedule will only benefit LG Uplus, the smallest market player. LG Uplus will be able to provide the highest-quality 5G services to its users almost immediately after purchasing its new 5G spectrum, due to reduced costs needed to install relevant equipment, unlike the top two market players whose services will not be availabl

Jan 27, 2022By Lee Kyung-min

ICT minister hints at delay of 5G spectrum license auction

Companies

POSCO restructuring plan edges closer to realization

POSCO CEO Choi Jeong-woo By Lee Kyung-min Korea's steel giant POSCO said Wednesday that it is nearing the completion of its corporate restructuring plan, whereby an envisioned holding firm will claim the entire shares of its spun-off steelmaking operation to the exclusion of current POSCO shareholders.The months-long move was advanced by Monday's go-ahead from the National Pension Service (NPS), POSCO's largest shareholder with a 9.75 percent stake. “The NPS gave a positive assessment of the restructuring plan, including ways to strengthen its non-steel businesses, after the firm is divided into a holding firm and a spinoff,” a POSCO official said.Most at play was the steel giant's revision of corporate articles of incorporation, clearly stipulating that the spun-off firm is not to be listed on the stock market, major grounds the pension fund dismissed concerns of POSCO shareholders over a steep share price fall if the spinoff leads to an initial public offering.“The

Jan 26, 2022By Lee Kyung-min

POSCO restructuring plan edges closer to realization

Economy

Contribution Future of Chinese growth and implications for Korea

Pushan Dutt By Pushan DuttWhen economists talk of growth miracles, they refer to countries that grew rapidly and caught up with the level of the development of the U.S. Korea, among others, is the poster child of growth miracles. In 1950, Korea's per capita GDP was 6 percent of the U.S. Today that number is 71 percent. China's growth take-off started three decades later, and despite the vast differences in size, the two growth trajectories are nearly inseparable (see graph below). China's catch-up has lifted vast numbers out of dire poverty and is one of the finest achievements in the history of economic development. Going forward, will China follow Korea's trajectory, or will a confluence of policy shifts, geopolitical conflicts, and demographic constraints ensnare it in the dreaded Middle-Income Trap? The middle-inco

Jan 26, 2022By Lee Kyung-min

[Contribution] Future of Chinese growth and implications for Korea

Companies

Hyundai Engineering IPO aims to expand green energy business

Hyundai Engineering CEO Kim Chang-hagBy Lee Kyung-min Hyundai Engineering, the construction affiliate of Hyundai Motor Group, will accelerate its green energy transition by venturing into new high-tech energy businesses with funds raised via its upcoming initial public offering (IPO) on Feb. 15, the company CEO said Tuesday.Sustainability will be the top growth priority for the benchmark KOSPI listing ― a goal highly feasible for the firm, underpinned by its years of experience in the fields of engineering, procurement and construction (EPC), chemical and energy plant construction and infrastructure construction. EPC entails turnkey solutions, whereby a construction firm provides a complete package of said services. Cooperation between Hyundai affiliates will be bolstered to create momentum for stable, clean, hydrogen-oriented energy generation, sustained by hefty investments in and technology partnerships for utilizing plastics, ammonia and greenhouse gases. Among the firm's renewable businesses portfolio is the Micro Modular Reactor (MMR), a nuclear energy system that delivers safe

Jan 25, 2022By Lee Kyung-min

Hyundai Engineering IPO aims to expand green energy business

Companies

Expansion of nuclear energy 'undesirable'

Minister of Trade, Industry and Energy Moon Sung-wook. Korea Times fileBy Lee Kyung-min It is undesirable to construct new nuclear power plants in Korea unless safe storage and disposal of high-level radioactive waste including spent nuclear fuel can be guaranteed, the energy minister said Tuesday.A total of 24 nuclear plants are in operation, and debate is ongoing as to whether increasing the number is appropriate, he said, repeating concerns raised frequently but ending without a solution.“My answer is that the government does not have a favorable view on the expansion of nuclear energy,” Trade, Industry and Energy Minister Moon Sung-wook said at a press briefing at the Sejong Government Complex.The firm stance followed a question on whether Korea should resume operation of currently halted nuclear power plants, as has been suggested by both ruling and opposition presidential contenders amid soaring energy prices. “It is inappropriate for me to judge the opinions of presidential candidates, but I have to say an increase in nuclear energy dependence is undesirable,

Jan 25, 2022By Lee Kyung-min

Expansion of nuclear energy 'undesirable'

Politics

Korea's contradictory nuclear energy policy raises eyebrows

Wolseong 1 nuclear reactor in Gyeongju, North Gyeongsang Province. Korea Times fileGov't eager to shut down nuclear plants, while seeking to build many abroad By Lee Kyung-min The Moon Jae-in administration has been under constant criticism for its double standards on nuclear energy, as it shows completely different attitudes toward nuclear power plants at home and abroad, according to economists and energy analysts, Monday.While abroad, Moon has been touting Korea's nuclear plants as the world's safest and most efficiently run, urging foreign governments to adopt the country's nuclear reactors. But here at home, the Moon administration has been eager to shut down local plants, calling nuclear energy an environmentally harmful and outdated energy source, and instead stressed the use of solar, wind and other renewable energy sources.This is a clear failure of the Moon administration's energy policies, they said, highlighted further by a rapid overall decline in industrial productivity brought on by higher energy import costs. Further complicating the issue is the ongoing criminal

Jan 24, 2022By Lee Kyung-min

Korea's contradictory nuclear energy policy raises eyebrows

Companies

Steelmakers consider upping dividends to ease shareholder concerns over restructuring

POSCO CEO Choi Jeong-woo By Lee Kyung-min Korea's steel giants are increasingly embracing shareholder-friendly dividend policies, in a collective move to appease investor concerns over corporate restructuring plans, whereby the holding firms will claim the entire shares of their spinoffs to the exclusion of current firm shareholders. Almost all shareholders are concerned that the share prices of the holding firms will plummet, once the spinoffs with far greater growth potential are listed. The much-dreaded scenario is almost certain to materialize, as illustrated in precedents set by two major Korean holding firms ― LG Chem and SK Chem, both of whose share prices took a dive following spinoff plans concerning LG Energy Solution and SK Bioscience. Korea's steel giant POSCO said earlier this year that it would retire part of its over 11.6 million shares held by the firm, the first such move in 17 years. Its per-share dividend price, it added, will be raised to 10,

Jan 23, 2022By Lee Kyung-min

Steelmakers consider upping dividends to ease shareholder concerns over restructuring

Banking & Finance

Mom's Touch delisting feared to benefit large shareholders only

The owner of a Mom's Touch franchise restaurant in Seoul holds a sign protesting the franchisor's abusive management practices, Oct. 27, 2021. Korea Times fileBy Lee Kyung-min Criticism is mounting over the delisting of Mom's Touch, a local fast-food franchisor. Market watchers are calling the move an irresponsible, rushed exit strategy pursued at the expense of retail shareholders, who are highly likely to incur considerable losses, if market prices set by the current tender offer fall short of their purchase prices. Some say that the delisting from the tech-heavy Kosdaq market is a calculated move by KL & Partners, the private equity firm that operates F&B Holdings Korea, the largest shareholder of Mom's Touch, with a 67.49 percent stake, to avoid accounting data disclosure responsibilities. The delisting legitimizes keeping small franchise owners out of the loop to evade due, equitable profit sharing. Others view the delisting as a step toward preparing for a listing in a few years, once all shares of the firm are bought back, as an easy way to fundamentally remove any pos

Jan 23, 2022By Lee Kyung-min

Mom's Touch delisting feared to benefit large shareholders only

Companies

Companies fear new industrial accident law

By Lee Kyung-min Shipbuilding, construction, machinery and parts manufacturing companies are deeply concerned about a new law set to take effect next week that will hold the heads of big businesses accountable for fatal industrial accidents, according to industry officials Thursday.Under the law, CEOs of large companies will be subject to a minimum prison term of one year or a fine of up to 1 billion won ($843,000) if fatal industrial accidents, including the deaths of workers, occur at smaller partner firms. The CEOs fear they may be held liable for on-site accidents involving small partner firm workers, regardless of immunity from supervision responsibilities, as granted under the contract between two firms to protect business secrets or due to the highly skilled nature of the work. “Corporate activities will be wildly undermined, I'm afraid,” an official at a large shipbuilding firm said on condition of anonymity. “I think I speak for everyone in the key manufacturing industries. The public sentiment is more likely than not to demand severe punishment of larger f

Jan 23, 2022By Lee Kyung-min

Lee Kyung-min

Read more

HDC to suffer downgrade risks in credit, ESG and brand power

ICT minister hints at delay of 5G spectrum license auction

POSCO restructuring plan edges closer to realization

Contribution Future of Chinese growth and implications for Korea

Hyundai Engineering IPO aims to expand green energy business

Expansion of nuclear energy 'undesirable'

Korea's contradictory nuclear energy policy raises eyebrows

Steelmakers consider upping dividends to ease shareholder concerns over restructuring

Mom's Touch delisting feared to benefit large shareholders only

Companies fear new industrial accident law

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