4 bidders vying for KDB Daewoo
From left are KB Financial Group Chairman Yoon Jong-kyoo, Mirae Asset Financial Group Chairman Park Hyun-joo, and Korea Investment Holdings Vice Chairman Kim Nam-goo.
By Choi Kyong-ae
Four bidders have submitted a final bid to acquire a controlling stake in KDB Daewoo Securities to the state-run Korea Development Bank (KDB). The biggest shareholder plans to select a preferred bidder, Thursday, according to KDB, Monday.
KB Financial Group, Mirae Asset Securities, Korea Investment & Securities and KDB Daewoo’s employee stockholders association are vying for the 43 percent stake in KDB Daewoo and an entire 100 percent stake in the unlisted KDB Daewoo Management in a package deal, the KDB said.
“We will select a preferred bidder according to our principles of maximizing investment returns and of contributing to the domestic financial markets through the sale,” the statement said.
The 43 percent stake was valued at 1.545 trillion won ($1.3 billion) based on Monday’s closing price of 11,000 won. When a management premium is included, the acquisition price may go up to between 2.5 trillion and 3 trillion won, analysts said.
According to local reports, KB Financial, Mirae Asset and Korea Investment & Securities offered prices which exceed 2 trillion won but Mirae Asset offered the highest price.
The companies declined to comment.
Mirae Asset, which has gone global since its foundation in 1997, plans to further cement its leading status in the securities industry. Korea Investment & Securities joined the auction as it seeks to expand its mainstay brokerage business.
KB, which earns nearly 70 percent of its net profit from the banking sector, badly needs to shore up its non-banking sector by acquiring KDB Daewoo.
Banks face growing challenges at home due to declining net interest margins due to record low benchmark rates and customers’ changing taste for mobile banking on their smartphones. They are shifting their focus from banking to non-banking businesses to diversify their income sources.
KDB aims to close the deal in the first half of next year. It bought the majority stake in Daewoo Securities in 2000 after its former parent, the now-defunct Daewoo Group, went bankrupt during the 1998 Asian financial crisis.