- Published 2026.11.06 06:02
All $9 billion Brookfield is injecting recognized as Naver adjusted debt
Positive view of risk control under phased expansion strategy; stable outlook maintained
Global credit rating agency S&P has maintained Naver's existing credit rating in relation to the company's massive artificial intelligence (AI) infrastructure investment. Although the entire capital injection from Brookfield was counted as debt, increasing pressure on financial metrics, S&P expects Naver to control risk by adjusting the pace of business expansion.
On Nov. 5, S&P Global Ratings announced it affirmed Naver's long-term issuer credit rating and senior unsecured bond rating at A- each, with a stable outlook.
The key issue in the assessment was the funding structure of Naver's global AI factory business. Last month, Naver signed a $9 billion (about 12 trillion won) computing infrastructure procurement agreement with Brookfield. Under the deal, Brookfield will fully fund a special purpose vehicle (SPV) called Asset Co, which will acquire key infrastructure such as graphics processing units (GPUs) and data centers, and Naver Cloud will lease and use them.
S&P included the entire $9 billion Brookfield is injecting into Asset Co in Naver's adjusted debt. Since parent company Naver guarantees the usage fees Naver Cloud must pay to Asset Co, S&P judged the capital to be debt-like, effectively supporting a fixed return distribution to Brookfield.
S&P analyzed that Naver's free cash flow will turn negative as the company sharply increases capital expenditure for GPU procurement from 2027 to 2028. However, the structure is designed so that once Asset Co begins returning profits to Brookfield in the form of dividends and capital reductions, Naver's adjusted debt will decrease in proportion to those amounts.
Behind the decision not to downgrade the rating despite the surge in adjusted debt is Naver's phased expansion strategy. Naver plans to sequentially increase data center capacity from 55 megawatts (MW) in the first half of 2027 to 200 MW by 2028. S&P assessed that this structure allows Naver to control the pace of investment and properly manage financial and business risks.
"Naver guarantees the contractual payment structure between Naver Cloud and Asset Co, which ultimately supports stable distributions to Brookfield," S&P said. The agency also forecast that Naver's adjusted debt leverage will slightly exceed 1x in 2028 and then gradually decline.
※ This article is an AI translation of the Korean original published by Korea Credit News; it was checked by automated quality guards and published by the English edition desk.
