ID :
41785
Wed, 01/21/2009 - 03:03
Auther :
Shortlink :
https://www.oananews.org//node/41785
The shortlink copeid
Hanwha may drop offer for Daewoo: analysts
By Nam Kwang-sik
SEOUL, Jan. 20 (Yonhap) -- South Korea's Hanwha Group will likely scrap its
takeover bid for Daewoo Shipbuilding & Marine Engineering Corp., the world's No.
3 shipyard, analysts said Tuesday, despite the group's denial.
Hanwha signed a preliminary deal with the state-run Korea Development Bank (KDB)
on Nov. 14 to buy a 50.4-percent stake in the shipbuilder without a due diligence
due to the shipbuilder union's opposition.
KDB, the shipbuilder's main creditor, plans to make a final decision within this
week on a deal over the sale of the shipbuilder's stake.
Earlier in the day, Hanwha denied a news report from local daily the Dong-A Ilbo
newspaper that the group has already decided to give up the acquisition of Daewoo
Shipbuilding.
"The news report is not true. We are doing our best to strike a deal with KDB," a
group official said.
In contrast to the official's remarks, two analysts, who asked not to be
identified citing company policy, said that nobody believes that the takeover
deal will be clinched in the current market.
"I believe that Hanwha was too greedy for its financial situation and its plan to
raise funds for the takeover deal by selling its assets was not realistic in
light of a deepening global economic downturn, "an analyst said .
Other analyst of the two said the share prices of affiliates of Hanwha Group
including Hanwha Corp. and Hanwha Chemical Corp. have reflected investors'
sentiment on the acquisition.
"Shares of Hanwha and Hanwha Chemical started gaining ground beginning the end of
last year when people were talking about the breakdown of the takeover deal," he
said. "Investors bet that the deal will be a burden on the financial health of
Hanwha, without creating synergy due to the groups business portfolio."
The group's business portfolio ranges from construction and insurance to
petrochemicals.
Shares of Hanwha closed at 18,600 won (US$13.5) on Dec. 29, last year, but ended
at 26,900 won on Jan. 19. Hanwha Chemical shares also finished at 6,000 won on
Dec. 30, last year, and closed at 7,750 won on Jan. 19.
Hanwha reportedly offered 6.5 trillion won for Daewoo Shipbuilding, but had
requested postponement of payment on Dec. 26, last year amid a severe credit
crunch.
The lender rejected the request, instead offering to extend the deadline until
Jan. 30 and buy some of Hanwha's assets to help it raise money for the takeover.
On Jan. 9, Hanwha urged KDB to partially sell its stake in the shipbuilder, but
its call was rejected.
In the wake of the rejection, Hanwha handed over its funding plan for the deal,
raising up to 3.8 trillion won by selling its assets such as stakes in real
estate and Korea Life Insurance, the nation's No. 2 life insurer.
Last week, KDB, however, called on Hanwha to submit its new funding plan for the
takeover bid within this week, saying the submitted plan is not enough to strike
a deal.
ksnam@yna.co.kr
(END)
SEOUL, Jan. 20 (Yonhap) -- South Korea's Hanwha Group will likely scrap its
takeover bid for Daewoo Shipbuilding & Marine Engineering Corp., the world's No.
3 shipyard, analysts said Tuesday, despite the group's denial.
Hanwha signed a preliminary deal with the state-run Korea Development Bank (KDB)
on Nov. 14 to buy a 50.4-percent stake in the shipbuilder without a due diligence
due to the shipbuilder union's opposition.
KDB, the shipbuilder's main creditor, plans to make a final decision within this
week on a deal over the sale of the shipbuilder's stake.
Earlier in the day, Hanwha denied a news report from local daily the Dong-A Ilbo
newspaper that the group has already decided to give up the acquisition of Daewoo
Shipbuilding.
"The news report is not true. We are doing our best to strike a deal with KDB," a
group official said.
In contrast to the official's remarks, two analysts, who asked not to be
identified citing company policy, said that nobody believes that the takeover
deal will be clinched in the current market.
"I believe that Hanwha was too greedy for its financial situation and its plan to
raise funds for the takeover deal by selling its assets was not realistic in
light of a deepening global economic downturn, "an analyst said .
Other analyst of the two said the share prices of affiliates of Hanwha Group
including Hanwha Corp. and Hanwha Chemical Corp. have reflected investors'
sentiment on the acquisition.
"Shares of Hanwha and Hanwha Chemical started gaining ground beginning the end of
last year when people were talking about the breakdown of the takeover deal," he
said. "Investors bet that the deal will be a burden on the financial health of
Hanwha, without creating synergy due to the groups business portfolio."
The group's business portfolio ranges from construction and insurance to
petrochemicals.
Shares of Hanwha closed at 18,600 won (US$13.5) on Dec. 29, last year, but ended
at 26,900 won on Jan. 19. Hanwha Chemical shares also finished at 6,000 won on
Dec. 30, last year, and closed at 7,750 won on Jan. 19.
Hanwha reportedly offered 6.5 trillion won for Daewoo Shipbuilding, but had
requested postponement of payment on Dec. 26, last year amid a severe credit
crunch.
The lender rejected the request, instead offering to extend the deadline until
Jan. 30 and buy some of Hanwha's assets to help it raise money for the takeover.
On Jan. 9, Hanwha urged KDB to partially sell its stake in the shipbuilder, but
its call was rejected.
In the wake of the rejection, Hanwha handed over its funding plan for the deal,
raising up to 3.8 trillion won by selling its assets such as stakes in real
estate and Korea Life Insurance, the nation's No. 2 life insurer.
Last week, KDB, however, called on Hanwha to submit its new funding plan for the
takeover bid within this week, saying the submitted plan is not enough to strike
a deal.
ksnam@yna.co.kr
(END)
