KDB Financial eyes Asian takeovers

(ATTN: ADDS more details in paras 7,11-16)
SEOUL, Nov. 2 (Yonhap) -- KDB Financial Group Inc., the parent of South Korea's
largest state lender, is looking to acquire financial firms in Asia as part of an
effort to expand its funding sources, its chief said Monday.
"KDB Financial will seek to find growth engines first by expanding its foray into
Asian markets...We are looking at two or three countries," KDB Financial Group
president Min Euoo-sung told reporters.
"By seeking to take over financial firms in Asia, we could secure funding sources
in diverse currencies," Min said.
KDB Financial Group was created last week as the holding company for the
state-run Korea Development Bank (KDB) and four other units as part of a
government plan to sell its stake.
Korea Finance Corp., split from the KDB, will serve as a policy lending
institution and the holding company will retain KDB's banking business.
Min earlier said KDB will seek to list shares of the holding company on the Seoul
bourse in 2011 and on overseas stock markets in 2012 in a bid to accelerate the
privatization of the bank.
Separately, Min said KDB Financial could provide support to potential bidders for
Daewoo Engineering & Construction Co. and Ssangyong Motor Co., if they have
genuine commitment to taking over such firms.
"If a bidder has an authentic commitment to buying a firm but faces funding
difficulty, we are willing to provide financial support," he said. "We could
offer part of the takeover funds or provide funds necessary for capital
investment after a bidder completes a takeover."
The bidding for Daewoo Engineering, South Korea's third-largest builder, opens
this week. KDB is seeking to complete it by mid-November and Min said in early
October that the builder will "most likely" be sold to a foreign investor.
Earlier, KDB decided to offer 130 billion won (US$262.2 million) in fresh loans
to ailing Ssangyong Motor to cover its restructuring expenditures. The lender
rejected its funding request for new vehicle development.
A local district court will make a decision over whether to approve the embattled
carmaker's turnaround plan on Friday.
"If the turnaround plan is approved, it would better for Ssangyong to get new
financing through takeovers."
Meanwhile, Min reiterated that KDB will not provide financial support to
cash-strapped GM Daewoo Auto & Technology Co. unless the carmaker's parent
presents a plan to boost its competitiveness.
KDB has demanded General Motors Corp. take measures to hone GM Daewoo's long-term
competitive edge before seeking financial support. GM has a controlling
51-percent stake in GM Daewoo.
"For the time being, GM will solve its liquidity shortage of GM Daewoo with its
own funding. Negotiations (with GM) may continue into next year," Min said.
Amid stalled progress over fresh loans from KDB, GM has bought all new shares
offered by its Korean unit, worth 491.2 billion won.
sooyeon@yna.co.kr
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