SEOUL, Jul. 8 (Korea Bizwire) — The Korea Electric Power Corp. (KEPCO) plans to sell stakes in its two affiliates, officials at the state-run utility company said Monday, in a bid to improve its financial status.
The two affiliates are KEPCO Engineering & Construction Co. (KEPCO E&C) and Korea Electric Power Industrial Development (KEPID).
In a report submitted to the U.S. Securities and Exchange Commission (SEC) in April, KEPCO said it plans to sell a 14.77 percent stake in KEPCO E&C and all of its shares in KEPID to pay off debts and enhance management efficiency.
KEPCO owns a 65.77 percent stake in KEPCO E&C and a 29 percent stake in KEPID.
Industry insiders said that KEPCO can earn more than 100 billion won (US$85 million) from the stake sales.
Also in the report, KEPCO said its financial conditions could take a hit if there’s no electricity rate hike amid rising fuel costs.
KEPCO posted an operating loss of 630 billion won in the first quarter of the year, widening from an operating loss of 128 billion won a year earlier, while its sales declined 2.9 percent on-year to 15.24 trillion won.
KEPCO said earlier this month that it will introduce plans for a revised electricity rates system by the end of the first half of next year.
The company already decided to ease progressive tariffs for residential power use during the summertime.