Hanjin Group, the nation’s largest logistics conglomerate, announced on Wednesday that it sold off a 28.41 percent stake in S-Oil for 2 trillion won ($1.9 billion) to Saudi-based Aramco, the largest shareholder of the oil refinery.
“The decision was made as part of the group’s capital-raising efforts to address its deteriorating financial health,’’ the group said in a press release. So far, the group has raised 3.6 trillion won of capital.
The cash flow of Hanjin Group has been worsening since it was burdened by Hanjin Shipping, the shipping unit of the group, which has posted losses for three consecutive years since 2011.
The stock deal with Aramco is the second action for capital increase on the group level. Last year, the group raised 1.6 trillion won by selling the lucrative gas shipping line of Hanjin Shipping.
The self-rescue plan is also expected to help improve the financial health of Korean Air, another flagship affiliate of Hanjin Group. NICE Investors Service, a local credit appraiser, lowered a long-term credit rating of Korea Air by one notch to “A-” last week following its financial assistance to Hanjin Shipping.
