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Money For Overseas Expansion KOGAS to Raise Funds by Selling Gas Pipe Shares in Myanmar

Korea Gas Corporation (KOGAS) is selling its share in South East Asia Gas Pipeline (SEAGP) in Myanmar in order to reduce its debts and expand its overseas business.

As KOGAS made such a decision, all eyes are on the next movement of Daewoo International which secures a 25 stake in SEAGP.

According to KOGAS on May 18, the state-owned company recently decided to sell its share in SEAGP and loans to local financial investors. KOGAS currently holds a 4.17 percent stake in SEAGP and its book value reaches 38.3 billion won (US$32.33 million).

It is a lucrative business that makes 3 billion won (US$2.53 million) of the equity method income in KOGAS’ land gas pipes in Myanmar and 500 million won (US$422,119) of related businesses’ profit and loss.

The latest movement has something to do with KOGAS President Lee Seung-hoon’s pragmatic management. KOGAS is seeking to diversify overseas business portfolio while reducing its debts. The debt rate of KOGAS dramatically decreased from 381 percent in 2014 to 321 percent in 2015.