By Cathy Rose A. Garcia
Hana Financial Group’s plan to buy a controlling stake in Korea Exchange Bank (KEB) has met staunch opposition from KEB’s labor union.
``Hana Financial Group does not have the management ability to properly manage Korea Exchange Bank’s assets, finances and personnel,’’ the KEB labor union said, Friday.
Last week, Hana Financial, the country’s fourth largest financial services company, said it has signed a memorandum of agreement with Lone Star to purchase its 51.02 percent stake in KEB. The stake is estimated to be worth around $3.8 billion based on the current share price.
Hana Financial is conducting due diligence on the bank and will finalize the deal on Nov. 26. Hana would still have to get the required nod from the Financial Services Commission before the deal could be completed.
The KEB labor union is planning protests against the deal between U.S. private equity firm Lone Star and Hana Financial Group.
As a sign of revolt, KEB employees wore plain clothes instead of their uniforms to work, Friday.
Around 4,000 KEB employees at the main headquarters and around the country are expected to join to oppose Hana’s takeover.
With a merger between Hana and KEB, it would become the third largest banking group in the country. As of the end of September, Hana Financial had assets of 200 trillion won, while KEB's assets are at 116.2 trillion won.
Lone Star took over the then troubled KEB in late 2003, buying a 51 percent stake for $1.3 billion. It raised its stake to 64.62 percent, but sold part of it in 2007.
Throughout the years, there have been several attempts by Lone Star to divest its stake in KEB, but they continually encountered difficulties.
Lone Star was previously in talks with Australia & New Zealand Banking Group (ANZ) for the sale of its stake of the Korean lender.
cathy@koreatimes.co.kr