Stake sale by Hyundai Motor Group head and son in Hyundai Glovis 'credit positive': Moody's

A stake sale on Feb. 6 by Hyundai Motor Group Chairman Chung Mong-koo and his son in the group's logistics unit is credit positive, but will have no impact on Hyundai Glovis' Baa2 issuer rating or stable rating outlook, a major international credit rating agency said on Monday.

"The sale by Hyundai Glovis' major shareholders of part of their ownership stake in the company reduces regulatory risks arising from Hyundai Glovis' transactions with affiliate companies," Wan Hee Yoo, a Moody's vice president and senior analyst, said.

Chung and his only son, Eui-sun, vice chairman of Hyundai Motor. sold about 5 million shares of the logistics company in a block trade sale. As a result, the two Chungs' ownership stake in Hyundai Glovis fell to 29.99 percent from 43.40 percent.

The ownership stake sale is to meet a revised Anti-Trust Law governing intra-group transactions that will go into effect in mid-February. Under the stricter rules, business group owners and their family members are banned from holding a combined 30 percent stake or more in affiliates that earn more than 20 billion won a year.

AJP