Debt issuance of SK Group that has been voracious in its appetite for new business buyouts has hit 4.5 trillion won ($4.09 billion) so far this year, the biggest among South Korean conglomerates, followed by Lotte Group that has enjoyed revived appetite for its bonds after about a year-long prosecution’s investigation on the group’s corruption charges.

According to Korea Securities Depository on Thursday, SK Group has issued a total of 4.5 trillion won worth of corporate bonds so far this year, becoming the largest seller of debt among major business groups in the country. Lotte Group was the second biggest bond seller with 4.09 trillion won, followed by LG Group with 3.27 trillion won and Hyundai Motor Group with 2.49 trillion won. Samsung Group, the country’s biggest conglomerate, has offered a combined 870 billion won worth of corporate debt over the same period, suggesting that it has relied less on the local bond issuance market to raise funds.

SK Group’s bond issuance for this year was about 500 billion won more than its debt issuance for last year. By unit, SK Holdings Co. has sold 1.4 trillion won worth of corporate debt, followed by SK Telecom Co. with 650 billion won. SK Gas Co., which did not issue a single corporate bond last year, has sold 150 billion won worth of debt this year to purchase liquefied petroleum gas and spend on machinery maintenance and repair.

SK Group has been also actively involved in merger and acquisition deals this year. The conglomerate acquired a silicon wafer maker from LG Group in January and renamed it SK Siltron. It also invested in Chinese logistics firm ESR and North American shale gas firm Eureka Midstream. SK Group also invested in a consortium led by U.S.-based private equity fund firm Bain Capital to purchase the memory chip unit of Japan’s Toshiba. A final agreement has been signed for the acquisition.

Market analysts noted that SK Group has sold a large volume of corporate debt to use the proceeds to finance active mergers and acquisitions.

Lotte Group’s debt issuance for this year also more than doubled from last year’s total of 1.7 trillion won. The conglomerate failed to attract investors last year in bond markets due to the growing business risk amid the ongoing prosecutorial investigation over the group’s corruption charges that started after a feud among siblings of the founding families two years ago.

By unit, Lotte Shopping Co. has sold 960 billion won worth of corporate debt and Hotel Lotte Co. 840 billion won. A majority of the proceeds were used to repay debt including short-term notes.

Hyundai Motor Group has also issued a total of 3.27 trillion won debt so far this year, up from 1.7 trillion won last year. Hyundai Steel Co. has sold 1.04 trillion won worth of corporate bonds this year, up from 890 billion won last year. Kia Motors Corp. and Hyundai Dymos Inc. that did not issue any bonds last year have each sold 500 billion won and 200 billion won worth of new debt this year.

By Chung Hee-young and Lee Eun-joo

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