June 27, 2019 / 1:14 AM / 2 months ago

CORRECTED-S.Korea's Woongjin to sell water purifier rental unit

(Corrects to trillion won and to billion U.S. dollars in paragraph 1)

SEOUL, June 27 (Reuters) - South Korea’s Woongjin Group said on Thursday that it would sell a 25.08 percent stake in water purifier rental firm Woongjin Coway, just three months after the group regained control of the unit for 1.89 trillion won ($1.59 billion).

The credit rating of holding firm Woongjin Co was recently downgraded after solar energy unit Woongjin Energy entered the court-led rehabilitation process, causing “unexpected financial risks”, the group said in a statement.

“We have agreed to preemptively sell Woongjin Coway before a crisis happens and to clear off all of our debts,” Woongjin said in a statement.

Shares of Woongjin Co slumped 14%, while Woongjin Thinkbig, an education service unit, rose 5%. Woongjin Coway rose 3.6% in a flat wider market.

Woongjin, which has hired Korea Investment and Securities to manage the deal, said it aimed to complete the sales within one year.

Woongjin Thinkbig bought a 22.17 percent stake in Woongjin Coway in March from South Korean private equity firm MBK Partners for 1.69 trillion won, nearly six years after the group had sold the unit. It subsequently bought an additional stake worth about 200 billion won.

Woongjin Group borrowed about 1.6 trillion won to finance the deal. ($1 = 1,185.7800 won) (Reporting by Sangmi Cha and Hyunjoo Jin; Editing by Stephen Coates)

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