By Kim Jae-won
Korea Development Bank (KDB) is now pursuing its plan to sell a 43 percent stake in KDB Daewoo Securities amid keen attention from potential bidders, including KB Financial Group and Chinese investors.
The state-controlled lender said Monday that its board of directors approved the plan to sell its three affiliates ― KDB Daewoo Securities, KDB Asset Management and KDB Capital ― with the aim of maximizing deal prices and contributing to the development of local capital markets.
Market watchers said the price of KDB Daewoo Securities is expected to top 3 trillion won, marking one of the biggest merger and acquisition deals in the industry this year.
“We will set up the Financial Affiliates Sales Committee to push for the sales process transparently and fairly,” said KDB director Lee Dae-hyun at a press conference.
Lee said the bank will sell its stake in the brokerage house by accepting applications from multiple bidders to make the process more transparent and fair. By law, the sales process will be pushed for with at least two qualified bidders.
The lender said it will appoint two lead managers ― one from a local company and the other from a foreign company. They will calculate the deal price based on KDB Daewoo Securities’ assets and corporate value before the main bidding process begins.
An accounting company and a law firm also will be selected to offer consulting services for the deal.
KB Financial Group said it is interested in buying KDB Daewoo Securities to strengthen its weak brokerage affiliate, saying it has enough cash to purchase the stake.
“We have sufficient funds to buy the company,” said a KB executive, asking not to be named. “The problem is our strategy in the securities industry.”
He said the group runs a small brokerage house that is strong in corporate business, but it is seeking a bigger role in the industry, reaching into retail business.
KDB Daewoo is among the four biggest brokerage houses in the country, along with Korea Investment & Securities, NH Investment & Securities and Samsung Securities.
KB lost a bid to buy Woori Investment & Securities two years ago to NH Financial Group.
Market watchers said Chinese financial giants, such as Anbang Insurance Group and Citic Group, also are interested in the deal. Anbang signed to acquire a 63 percent stake in Korean life insurer Tong Yang Life from local buyout fund Vogo Investment Group at 1.1 trillion won in February.