Koramco Asset Trust will acquire the JoongAng Ilbo and JTBC headquarters buildings and the Ilsan studio for 550 billion won, with JoongAng Group set to lease back the properties after the sale.
According to investment banking (IB) industry sources on the 21st, JoongAng Group has selected Koramco Asset Trust as the preferred bidder for the JoongAng Ilbo and JTBC buildings and the Ilsan studio. Colliers Korea is managing the sale. JoongAng Group had been negotiating with potential buyers on the condition that all three properties be acquired together, and ultimately chose Koramco Asset Trust.
JoongAng Group is expected to use the proceeds from the building sale to repay debt and improve its financial structure. The group is facing growing concerns over its financial soundness as credit ratings for its major affiliates have been downgraded. Amid these challenges, efforts to secure liquidity through mergers and sales have also stalled, increasing uncertainty across the group.
Korea Investors Service recently revised the credit rating outlook for SLL JoongAng and JoongAng Ilbo from "BBB/Stable" to "BBB/Negative." Korea Ratings downgraded the credit ratings on commercial paper and short-term electronic bonds issued by Megabox JoongAng and Contentree JoongAng from A3 to A3-. As with SLL JoongAng and JoongAng Ilbo, deteriorating financial health was cited as the reason for the rating action.
"The reality is that the overall media business environment, both at home and abroad, continues to grow more challenging," a JoongAng Group official said. "This liquidation is an active and preemptive decision at the group level to maximize flexibility in fund management under these circumstances."
