By Kang Seung-woo
Tong Yang Group is considering selling its stake in Tong Yang Life Insurance to improve the financial structure of its cement unit, a company official said Friday.
Affiliates of the group own a 50 percent stake in the life insurer.
The group, which has been put under a creditor-led restructuring program since April 2009, has made efforts to transform itself into a financial holding group based on Tong Yang Major Corp., but has struggled due to weakening demand in the construction and cement industries.
Tong Yang Major is a company principally engaged in making and selling cement and ready-mixed concrete, and using those materials to build luxury apartments, offices, industrial plants, and dams.
The group said that the sale of the stake is focused on reducing debts and normalizing Tong Yang Major.
“The group is seeking ways to cut debts of Tong Yang Major by selling part of a 50 percent stake in Tong Yang Life Insurance owned by the group’s other affiliates,” a high-level group official said, but he said that details have yet to be determined.
He added: “It is a restructuring program, taking advantage of stakes in Tong Yang Life Insurance, not the sales of the right of management.”
According to the group, it is likely to finalize the planned sale within this month.
Tong Yang Financial Services Corp. is the largest shareholder of the life insurance company with 28.7 percent, followed by Tong Yang Securities and Tong Yang Capital, which holds 13.3 percent and 7.5 percent, respectively.
Tong Yang Life listed its shares on the Korea Exchange (KRX) in October last year.
ksw@koreatimes.co.kr