I’m currently managing director of Content and Business Planning at The Korea Times. Before I took the current position in early 2024, I served as managing editor in charge of both paper and online for over three and a half years. In 2015-2018, I worked as Singapore correspondent covering ASEAN nations.
Hana Financial to buy KEB for W4.7 trillion
By Kim Jae-kyoung
Hana Financial Group said Tuesday it has decided to take over a controlling 51.02 percent stake in Korea Exchange Bank (KEB) from Lone Star Funds for around 4.7 trillion won.
The group said it will hold a board meeting to finalize the takeover of the nation’s fifth-largest lender this morning and Chairman Kim Seung-yu will hold a press conference in the afternoon ahead of a public disclosure.
Hana Chairman Kim plans to fly to the U.S. to sign the sale and share purchase agreement with John Grayken, chairman of Lone Star, Thursday after the board approves of the transaction. Hana plans to apply for a regulatory approval for the deal, including its funding plan, the same day.
"We have finalized most of the acquisition process. I will announce every detail regarding the KEB deal, including our funding plan, tomorrow,” Hana Kim told reporters.
The group said that the takeover price is expected to be somewhere between 4.6 trillion won and 4.8 trillion won, which is within the current market value plus a 10 percent premium on managerial rights.
Regarding its funding plan, the group said that it will not seek to increase capital to protect existing shareholder value. Instead, it plans to sell bonds and seek financial investors to raise funds needed to pay for the stake.
In addition, Hana plans to operate its banking unit Hana Bank and KEB separately under the same wing for the time being. It also plans to retain KEB’s corporate name and identity with its shares continuing to be traded on the main bourse.
“We will maintain two banking units separately under Hana Financial Group. There will be no layoff of KEB workforce even after the takeover,” Hana Bank CEO Kim Jung-tae told reporters Tuesday.
KEB shares closed at 12,350 won Tuesday, down 550 won or 4.26 percent from the previous close, while Hana shares soared by 2,000 won or 5.71 percent to 37,000 won.
The acquisition of KEB is expected to change the landscape of the local banking sector.
Hana will become the third largest banking group in the country, edging out Shinhan Financial Group. In September, Hana Financial had assets of 200 trillion won, while KEB's assets were estimated at 116.2 trillion won.