Mirae Asset named preferred bidder for KDB Daewoo

By Choi Kyong-ae

A Mirae Asset Securities-led consortium has been named as the preferred bidder to acquire a controlling stake in KDB Daewoo Securities, the state-run Korea Development Bank (KDB) said Thursday.

KDB, which controls KDB Daewoo with a 43 percent stake, held a board meeting to select the consortium as the preferred bidder for the stake in KDB Daewoo and the entire 100 percent stake the state-run bank owns in KDB Daewoo Management in a package deal, the bank said.

“We have selected Mirae Asset as the preferred bidder according to our principles of maximizing investment returns and contributing to the domestic financial markets through the sale,” Lee Dai-hyun, senior executive director of the Strategy and Planning Division at KDB, said in a press briefing.

Lee said the combination of the country’s asset management leader Mirae Asset and established brokerage KDB Daewoo Securities will generate a mega securities company and allow it to expand overseas.

The Mirae Asset consortium composed of Mirae Asset Securities and Mirae Asset Global Investments beat three other bidders ― KB Financial Group, Korea Investment & Securities and KDB Daewoo’s employee stockholders association.

It reportedly submitted the highest acquisition price of 2.45 trillion won ($2.1 billion) for the stake up for sale. The 43 percent and 100 percent stake are priced at 1.84 trillion won in combined book value. When a management premium is included, the acquisition price was widely expected to reach between 2.5 trillion and 3 trillion won.

Media reports said that Korea Investment & Securities and KB Financial Group offered 2.2 trillion won and 2.1 trillion won, respectively.

KDB didn’t confirm the reported acquisition price.

Mirae Asset is required to pay 5 percent of its bid by Jan. 4 and sign a share purchase agreement with KDB by the end of January. In February, Mirae Asset plans to conduct due diligence on KDB Daewoo to seal the deal.

Mirae Asset, which has gone global since its founding in 1997, aims for a bigger share in the securities industry.

Asset management has emerged as a core growth driver in the non-banking business for financial companies as banks face growing challenges due to lower interest rates and bigger demand for online mobile banking.