preferred bidder-Daewoo Shipbuilding

(LEAD) Hanwha picked as prime bidder for Daewoo Shipbuilding
(ATTN: ADDS more details in paras 2-3)

SEOUL, Oct. 24 (Yonhap) -- South Korea's state-run lender Korea Development Bank (KDB) said Friday it picked chemical and energy-focused Hanwha Group as a preferred bidder for Daewoo Shipbuilding & Marine Engineering Co.

KDB plans to sign a final deal with Hanwha to sell Daewoo Shipbuilding within the
year, after a three or four-week due diligence on the shipbuilder starting early
November, it said in a statement.
The lender did not reveal the bidding price, but some market analysts estimate
the value of the stake at over US$5 billion.
Hanwha and Hyundai Heavy Industries Co. had vied for buying a 50.37 percent stake
in the world's No. 3 shipbuilder after KDB disqualified POSCO as a potential
buyer on Oct. 16, taking issue with its qualifications.
POSCO formed a consortium with GS Group, an energy and construction conglomerate,
to make a joint bid for the controlling stake but the group backed out at the
eleventh hour, rendering the steel giant ineligible.
Daewoo Shipbuilding & Marine Engineering was placed under a debt workout program
in August 1999 after its parent Daewoo Group collapsed under heavy debts.
Shares of the shipbuilder tumbled by the daily limit of 15 percent to 11,000 won
($7.62) on the main bourse.
sooyeon@yna.co.kr
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