KB Financial Group Inc., Korea's No. 2 banking group, has increased its aggression in its bid to take over ING Life Korea, industry sources said Wednesday.
Negotiations on the acquisition of ING Life Korea by KB Financial Group are going smoothly and the two companies are narrowing the gap on terms, the sources said.
"KB Financial suggested through a third party that it would guarantee employment of the unionized workers of ING Life Korea," a source with knowledge of the matter said.
Employment has been one of the core issues of the takeover, as the unionized workers at ING Life Korea kicked off an indefinite strike in July, demanding the potential buyer of the life insurer retain its members after the acquisition.
KB Financial announced in July it would not bid for state-owned Woori Finance Holdings Co., the country's top financial group by assets. KB Financial's announcement was seen as a move to prepare for the acquisition of ING Life Korea.
The Dutch insurance giant ING Group is planning to sell its Asian subsidiaries in a bid to ease its financial problems.
The two companies are still debating on price, the sources said. ING Group expects its Korean unit could fetch an estimated 3.5 trillion won (US$3.04 billion), about 500 billion won higher than KB Financial's bid price, market sources said.
ING Group is trying to gain an upper hand in the price negotiation by luring other prospective buyers including the Hong Kong-based insurance giant AIA Group into a bidding race, according to market watchers.
A successful takeover of ING Life Korea would enable KB Financial to have an insurance subsidiary that ranks fourth among local insurance companies. Currently, the group has minor industry player KB Life Insurance Co. under its wing. (Yonhap)