ID :
101787
Fri, 01/22/2010 - 14:49
Auther :
Shortlink :
https://www.oananews.org//node/101787
The shortlink copeid
KDB to stick to plan for purchase of Daewoo Engineering
(ATTN: ADDS more details in paras 4-6; UPDATES with info about bid for Thai bank
from para 9)
SEOUL, Jan. 22 (Yonhap) -- The creditor bank of Daewoo Engineering & Construction
Co. plans to stick to its original plan to buy the troubled builder in a bid to
help the firm's parent group avert a liquidity crisis, the head of the Korea
Development Bank (KDB) said Friday.
A private equity fund led by KDB is seeking to buy a 50 percent stake plus one
share in the construction firm for 18,000 won (US$15.7) per share as part of
efforts to restructure cash-strapped Kumho Asiana Group.
The builder's financial investors oppose the transfer of their stakes at the
offered price, however, suggesting they would invest around 2.2 trillion won in
Kumho Industrial Co., the biggest shareholder of Daewoo Engineering, to secure
managerial rights to the firm.
After becoming the No. 1 shareholder for Kumho Industrial, they plan to recoup
their investment by selling stakes if the group gets its management back on track
later.
"As there is a time constraint to push for the restructuring of Kumho Group, we
cannot switch the (overhaul) process whenever an alternative comes out," said Min
Euoo-sung, president of KDB Financial Group.
"As the investment plan suggested by financial investors does not have sufficient
details, we cannot wait blindly."
But KDB added it could carefully consider an alternative with open-minded
attitude if the suggestion helps the group make a turnaround.
Kumho Asiana has been riddled with debt since buying a 72.1 percent stake in
Daewoo Engineering in 2006 for 6.4 trillion won, a deal mostly funded by the
financial investors.
Kumho faced a cash call worth around 4 trillion won from the investors, who
exercised their rights to sell shares in Daewoo Engineering back to the group on
Dec. 31 at above-market prices. Kumho Industrial must repay the amount by June
15.
Min also said the bank is seeing a high possibility that it will buy Siam City
Bank Plc, Thailand's No. 7 lender.
"(The potential purchase of the lender) will pave the way for making inroads into
the ASEAN financial markets," Min added.
KDB said Monday it is considering bidding for the Thai bank as part of efforts to
expand its reach into the Asian market.
Min has said the group is looking to acquire financial firms in Asia as part of
efforts to expand its funding sources ahead of its privatization. He said it is
looking at two or three countries for potential takeovers.
The Korean government plans to reduce its 100 percent stake in KDB Financial
Group within four years to put it in private hands. The group was created in late
October as the holding company for KDB and four other units.
The Bank of Thailand, the country's central bank, is seeking to sell a 47.6
percent stake in Siam City Bank by the second quarter of this year. The central
bank is poised to pick a preferred bidder for the lender around next month with
five or six investors showing interest in the bidding.
sooyeon@yna.co.kr
(END)
from para 9)
SEOUL, Jan. 22 (Yonhap) -- The creditor bank of Daewoo Engineering & Construction
Co. plans to stick to its original plan to buy the troubled builder in a bid to
help the firm's parent group avert a liquidity crisis, the head of the Korea
Development Bank (KDB) said Friday.
A private equity fund led by KDB is seeking to buy a 50 percent stake plus one
share in the construction firm for 18,000 won (US$15.7) per share as part of
efforts to restructure cash-strapped Kumho Asiana Group.
The builder's financial investors oppose the transfer of their stakes at the
offered price, however, suggesting they would invest around 2.2 trillion won in
Kumho Industrial Co., the biggest shareholder of Daewoo Engineering, to secure
managerial rights to the firm.
After becoming the No. 1 shareholder for Kumho Industrial, they plan to recoup
their investment by selling stakes if the group gets its management back on track
later.
"As there is a time constraint to push for the restructuring of Kumho Group, we
cannot switch the (overhaul) process whenever an alternative comes out," said Min
Euoo-sung, president of KDB Financial Group.
"As the investment plan suggested by financial investors does not have sufficient
details, we cannot wait blindly."
But KDB added it could carefully consider an alternative with open-minded
attitude if the suggestion helps the group make a turnaround.
Kumho Asiana has been riddled with debt since buying a 72.1 percent stake in
Daewoo Engineering in 2006 for 6.4 trillion won, a deal mostly funded by the
financial investors.
Kumho faced a cash call worth around 4 trillion won from the investors, who
exercised their rights to sell shares in Daewoo Engineering back to the group on
Dec. 31 at above-market prices. Kumho Industrial must repay the amount by June
15.
Min also said the bank is seeing a high possibility that it will buy Siam City
Bank Plc, Thailand's No. 7 lender.
"(The potential purchase of the lender) will pave the way for making inroads into
the ASEAN financial markets," Min added.
KDB said Monday it is considering bidding for the Thai bank as part of efforts to
expand its reach into the Asian market.
Min has said the group is looking to acquire financial firms in Asia as part of
efforts to expand its funding sources ahead of its privatization. He said it is
looking at two or three countries for potential takeovers.
The Korean government plans to reduce its 100 percent stake in KDB Financial
Group within four years to put it in private hands. The group was created in late
October as the holding company for KDB and four other units.
The Bank of Thailand, the country's central bank, is seeking to sell a 47.6
percent stake in Siam City Bank by the second quarter of this year. The central
bank is poised to pick a preferred bidder for the lender around next month with
five or six investors showing interest in the bidding.
sooyeon@yna.co.kr
(END)
