Taking its toll
In a search for alternative sources of funding, Korea Highway Corporation has turned to the structured finance market, issuing the country’s first ABS transaction backed by toll road receivables. Sang-Jun Lee of Korea Highway’s asset finance department, talks about the rationale behind the deal. Nick Sawyer reports
Building a road takes a huge amount of investment, especially when the road in question is a much-needed expressway around South Korea’s capital, Seoul. For road construction company Korea Highway Corporation, this vast expenditure brings with it the prospect of a painfully slow return on its investment, even given the millions of won in toll fees the company stands to earn from drivers using the new ring road each day.
This means the firm needs ongoing access to financing to fund new highway
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