KT doubles AAA debt issues from original offering on overwhelming response

South Korea’s major mobile carrier KT Corp. has decided to double its AAA rated debt issues to 400 billion won ($363.7 million) from its original offering plan after drawing overwhelming institutional bids of nearly seven times during a book building session.

On Thursday, KT announced in a regulatory filing that it will issue 400 billion won debts instead of its initial offering 200 billion won after it pulled in a total of 1.34 trillion won during the book building session held on Tuesday.

The unsecured bonds are arranged in four tranches – 130 billion won in three-year, 140 billion won in five-year, 50 billion won in 10-year and 80 billion won in 20-year with all the prices set 1 basis point (bps) lower than the market average, except the 20-year debt that was set below 4bps.

Its three-year bond is priced at a record low coupon for all Korean issuers, with bids exceeding 11 times.

Investors showed voracious appetite for KT’s debts because it is rated the strongest AAA credit rating by the country’s major rating agencies. The company’s business prospect also looks bright after the company has maintained brisk growth, backed by rising 5G network demand. It is also actively expanding into the B2B service sector beyond its mainstay consumer mobile service market.

The subscription is due on Jan. 27. The book runners are KB Securities, NH Investment & Securities, Hi Investment & Securities, and Shinhan Investment.

The company is selling the debts to refinance existing debts.

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