Tag Archives: Woori Bank

Woori Bank gains approval for acquisition of Bank Saudara stake

Yonhap Infomax reported that Woori Bank has received regulatory approval for the acquisition of a stake in Bank Saudara that it had proposed.  Woori Bank is a unit of listed South Korea-based Woori Finance.

The report cited Woori Bank’s announcement that the Indonesian financial regulator approved for it to acquire a 33% stake in the Indonesian bank. After the acquisition, Woori Bank will be the second largest shareholder in Bank Saudara.

(Source: Yonhap Infomax)

BST consortium acquires Millinet Solar for USD 46.3m – sources

The consortium led by BST, a privately held South Korea-based tempered glass maker, acquired 100% of Millinet Solar, a defunct solar cell producer, for KRW 52bn (USD 46.3m), two sources familiar with the situation said.

Milinet Solar and the consortium signed a share purchase agreement on 2 July 2013, one of the sources noted. The deal closed on 12 August 2013 after Millinet Solar’s creditors (Woori Bank, Kookmin Bank and Woori F&I) all agreed to the sale, he added.

The consortium consisted of BST, Jinyoung R&S, and undisclosed local firms, one of the sources noted.

Milinet Solar and its parent company Milinet filed for court-protected rehabilitation in March 2012 and they had been seeking a bidder under the court receivership. After they failed to find a buyer early this year, they were seeking for a separate sale, as earlier reported.

BST is an affiliated company of Smac, a listed South Korea-based mobile phone part manufacturer, which holds a 41.51% stake in BST.

Millinet Solar recorded sales of KRW 58.5bn in 2011.

Mergermarket Mark (Squared)
by DooBo Shim in Seoul

Woori sells stake in Byucksan E&C

The Korean banking unit of Woori Finance, Woori Bank, officially announced yesterday that they have sold their entire stake in Byucksan Engineering & Construction (E&C), the listed Korean construction company.  The 14.43 percent stake was sold in block deals, according to the stock exchange statement.

Byucksan E&C has a market cap of 102.5 billion won (USD 92.4 million).

Uamco will acquire Shinsung E&C

Uamco logo

Uamco, the bad asset management firm, plans to acquire Shinsung Engineering and Construction (E&C), a Korean construction company, for 26 billion won (USD 23.1 million) according to a report in the Money Today.

Uamco was set up by six commercial banks including Kookmin and Woori Bank.

Jong-seok Lee, the head judge at the third bankruptcy department at the Seoul Central District Court, has approved the sale proposal of Shinsung E&C to Uamco.  Shinsung has been under court receivership since 2008 and in 2011, recorded sales of 81.8 billion won (USD 75.3 million).

(Source: Money Today)

New “split-sale” of Woori Financial Group

The Financial Services Commission (FSC) has scrapped its plan to sell Woori Financial’s subsidiaries in a block deal and now plans to pursue a “split-sale” method to privatize the state-funded group this year.

According to a recent article in the Korea Herald, the split will be divided into three parts: sale of Woori Bank, sale of Woori Investment & Securities (the brokerage unit), and sale of Kyongnam Bank and Kwangju Bank (two provincial banks).

These financial firms are expected to draw attention from the mergers and acquisitions market.  Other large financial groups in Korea will most likely compete for Woori Bank, such as KDB Financial and KB Financial.  Other investors might seek to take only the brokerage unit in order to bolster the investment banking sector.

This decision comes after the FSC failed to attract appropriate investors for the block sale of the subsidiaries.  The revised plan has been recently presented to the presidential transition team and details of the revision will be fine-tuned by the arriving Park administration.

Halla E&C attempts to diversify through M&A

A listed Korean construction firm, Halla Engineering & Construction (E&C) plans to actively pursue M&A for diversification.  The company’s plan is called “Innovation and Challenge 2013”, where Halla E&C states its desire to use M&A to enter into plant and non-construction businesses.  The company and Woori Bank have agreed to extend the credit line by 300 billion won ($276 million) to use as a M&A war chest.  In addition, Halla E&C plans to divest some of their assets to improve their financial structure; however, it has not yet been disclosed which assets they are planning on selling.

Bidders Emerge in Daewoo Electronics Sale

Three companies, including Electrolux AB are said to have made bids to acquire appliance maker Daewoo Electronics. According to reporting by Business Insider, the other bidders were SM Group and a consortium composed of Dongbu Group and an unnamed financial investor. The stake has been predicted to sell for roughly 300 billion won and the sellers plan to choose a preferred bidder shortly and expect to complete the sale agreement by October.

Daewoo Electronics is one of the scores of assets acquired by the Korean government during the aftermath of the 1997 Asian financial crisis.  This marks the sixth attempt that the company’s creditors Woori Bank and Korea Asset Management Corp have made to sell the stake since 2006. Since 2008, the company has reported restructuring related yearly net losses while at the same time, maintaining yearly operating profits between 5 billion won and 40.1 billion won.

Electrolux has made previous failed attempts at acquiring Daewoo Electronics. Analysts believe Electrolux expects to see benefits through the acquisition from Daewoo’s presence in emerging markets.


Kumho Tire Capital Raising Scheduled for May

Shareholders of Kumho Tire are understood to have entered in-depth discussions last week to decide on the details of a 110 billion won new share sale set for May.

Kumho Tire, the auto parts unit of stricken Kumho Asiana, said January 3 it had not made a final decision on a capital raise despite on-going talks with a group of creditors, who are its largest shareholder. Woori Bank, Korea Development Bank, Kookmin Bank and Korea EXIM, own a combined 47.63 percent stake in Kumho Tire, which is restructuring debt.

Kumho’s shares have risen 34 percent since the disclosure and were trading at 13,600 won Monday morning. That values the creditor’s known stake at 697 billion won, based on the current market capitalization of 1.472 trillion won. Creditors’ undisclosed holdings could bring their total stake to as much as 60 percent.

Kumho Tire was reportedly planning to raise 110 billion won from a third party allotment to Chairman Park Sam-Gu, who is trying to regain control of the company. That has been previously agreed to by the creditor group, a company insider said. But different discounts and complicated tax issues are said to have creditors reviewing their options on how best to execute the move. Regardless of the method, Park will be allowed to acquire a stake.

A rights offering and public offering are also being considered to optimize the fairest price and preserve the interests of existing shareholders.

In a rights offering, creditors could sell the rights or choose to not subscribe to the offering so that Park could take up the shortfall. A rights offering has no discount limit but usually does not exceed 30 percent, two equity capital market bankers said. A public offering allows for an up to 30 percent discount while a third party placement allows for an up to 10 percent discount.

Technically speaking, a company under restructuring could be freed of any discount cap, if required, but they usually do not flout normal market custom in consideration of minority shareholders, one of the bankers said.

The proceeds could also be used to repay some of the 300 billion won worth of foreign currency loans maturing throughout this year.

Kumho Tire has an operating income of 194 billion won and net profit of 86 billion won as of September 30, 2011.

by mergermarket reporter Kate Kim

KAMCO Ssangyong Logo

KAMCO Posts Ssangyong E&C Sale Notice

The awaited sale of Korea Asset Management Company’s (KAMCO) 38.75 percent stake in Ssangyong Engineering & Construction moved forward yesterday when KAMCO posted an official notice  of the sale on its website. KAMCO and group of  six creditors, including Shinhan Bank, Woori Bank, ER&C, Hana Bank, Woori Investment & Securities, and Korea Exchange Bank are selling a combiend 50.7 percent stake in Ssangyong. According to the notice, KAMCO and the other sellers have chosen Ernst & Young Han Young and Shinhan Investment Corporation as co-arrangers of the sale.

To read the notice and other documents pertaining to the sale, have a look at KAMCO’s homepage.

Analysts optimistic as creditors announce 3rd Hynix sale

Reuters has reported that the creditors of Hynix Semiconductor, including Korea Finance Corp (KoFC), Shinhan Bank, Woori Bank and Korea Exchange Bank (KEB), have announced their third attempt at selling their $2.1 billion 15 percent stake.

The creditors of the world’s No. 2 computer memory chip maker will be accepting preliminary bids until July 8, but the deadline could be extended for another two weeks if only one bid is received. Currently, the only investor that has shown interest in the sale is Hyundai Heavy Industries

According to Reuters, analysts such as Lee Sun-tae, an analyst at Meritz Securities in Seoul, believe that the sale will be successful this time, due to improvements in the sale structure and Hynix itself. The creditors plan to allow the purchasing firm to sell 10 percent of new shares to another buyer. Selling new shares would give Hynix much-needed funds to update its production facilities, shrinking the usually enormous capital investment required in this cyclical industry. Lee also said that the Hynix sale has become more attractive as it has become “less vulnerable to an economic slump.”

On June 21, Hynix finished up 2.8 percent on the Korea Exchange (KRX) and saw a 1.4 percent rise in the broader market.

Creditors hope to select a preferred bidder by August and close the deal by the end of 2011.