Moody’s: E Mart unchanged after shares sale

Moody’s Investors Service said that E Mart Inc.’s sale of three million shares in Samsung Life Insurance Co., Ltd. is credit positive, but will not have an immediate impact on its Baa2 issuer rating or stable outlook.

The sale of Samsung Life Insurance shares will reduce E mart’s adjusted debt-to-EBITDA ratio by about 0.2x to 4.3x or 4.4x over the next two years provided that the proceeds are used to repay debt, Moody’s said.

This sale demonstrates the management’s increased commitment to containing the company’s debt against the backdrop of challenging retail industry conditions, the agency said.

Given the expected recovery in the same-store sales growth for full year 2015, Moody’s said it expects E mart’s consolidated earnings to grow modestly in 2015.

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