SEOUL– South Korean insurer Heungkuk Life Insurance Co. said Wednesday it will raise 230 billion won (US$178.9 million) through a rights offering.
Heungkuk Life will sell 2.44 million convertible preferred shares to tsis and Tcast, two unlisted affiliates of Taekwang Group, which will invest 200 billion won and 30 billion won, respectively, the insurer said in a regulatory filing.
Heungkuk Life is also an affiliate under Taekwang Group.
The move is intended to increase capital after Heungkuk Life exercised a Nov. 9 call option for its dollar-denominated perpetual bonds worth $500 million.
The buyback came about a week after the insurer jolted the debt market by announcing it will delay exercising the call option due to unfavorable market conditions.
Taekwang Group has said it would join the insurer’s capital increase as part of efforts to take social responsibility for the recent market chaos.
Taekwang Industrial Co. initially tried to take part in the capital increase by the insurer but dropped the plan in the face of criticism that it runs counter to shareholder’s value.
Source: Yonhap News Agency