ID :
91218
Mon, 11/23/2009 - 22:04
Auther :
Shortlink :
https://www.oananews.org//node/91218
The shortlink copeid
(2nd LD) Kumho picks Jabez Partners, TR America as bidders for Daewoo
(ATTN: UPDATES with more details and analysts' view on the deal para 10-15)
By Nam Kwang-sik
SEOUL, Nov. 23 (Yonhap) -- South Korea's Kumho Asiana Group said Monday it chose
two foreign funds as preferred bidders for a controlling stake in its
construction unit, Daewoo Engineering & Construction Co.
Kumho Asiana said it will negotiate with the Middle East-based Javez Partners and
TR America Consortium of the U.S. on the sale of a 50 percent stake plus one
share in Daewoo Engineering & Construction, estimated at 3.3 trillion won (US$2.8
billion).
"We selected the two foreign funds as the plural bidders for the stake, as they
were regarded as investors who will be able to finance the deal," the group said
in a statement.
Kumho Group also said that it has picked plural bidders in a bid to drive a hard
bargain for the stake.
The primary investor of TR America Consortium is Tishman Construction, the
largest builder by sales in New York in 2008, which built the Bank of America
Tower, One World Trade Center, and the InterContinental New York Times Square,
Kumho Asiana said.
Jabez Patners is in a parnership with Abu Dhabi Investment Council (ADIC), a
sovereign wealth fund owned by Abu Dhabi, the United Arab Emirates, the group
said.
Three prospective overseas buyers -- a sovereign wealth fund of the Middle East,
a U.S. builder and a Russian company -- submitted bids for the stake in the
nation's fourth-largest builder last Wednesday, Kumho Asiana said.
The bidding prices ranged from 20,000 won to 24,000 won per share, which places
the value of the deal at an estimated 3.3 trillion won, financial sources said.
Tokyo-based Nomura Securities Co. and the state-run Korea Development Bank, the
builder's main creditor, are arranging the sale.
Market watchers said it remains to be seen whether Kumho Asiana will ride out its
cash shortage, even though the deal is completed.
"The most important thing in the deal is the sale price per share of Daewoo
Engineering & Construction. And I'm not sure whether Kumho Asiana Group can break
out of its credit crunch through the stake sale because it is not known how much
the group can secure in cash by selling its other assets," said Cho Joo-hyung, an
analyst at Hanadaetoo Securities Co.
Another analyst, who asked not to identified, agreed with Cho, saying it is
believed that Kumho Asiana failed to secure enough cash through its asset sales.
The asset sale comes as the South Korean group has been plagued by cash shortages
since it bought a 72.11 percent stake in the builder in June 2006 for 6.42
trillion won, 3.5 trillion won of which was funded by banks and other financial
firms.
At the time, the group offered a put-back option, under which it promised the
financing providers it would buy back the builder's shares by December 2009 if
the stock price fell below 31,400 won.
Shares of Daewoo Engineering & Construction fell 1.42 percent to close at 13,900
won on the Seoul bourse on Monday.
ksnam@yna.co.kr
(END)
By Nam Kwang-sik
SEOUL, Nov. 23 (Yonhap) -- South Korea's Kumho Asiana Group said Monday it chose
two foreign funds as preferred bidders for a controlling stake in its
construction unit, Daewoo Engineering & Construction Co.
Kumho Asiana said it will negotiate with the Middle East-based Javez Partners and
TR America Consortium of the U.S. on the sale of a 50 percent stake plus one
share in Daewoo Engineering & Construction, estimated at 3.3 trillion won (US$2.8
billion).
"We selected the two foreign funds as the plural bidders for the stake, as they
were regarded as investors who will be able to finance the deal," the group said
in a statement.
Kumho Group also said that it has picked plural bidders in a bid to drive a hard
bargain for the stake.
The primary investor of TR America Consortium is Tishman Construction, the
largest builder by sales in New York in 2008, which built the Bank of America
Tower, One World Trade Center, and the InterContinental New York Times Square,
Kumho Asiana said.
Jabez Patners is in a parnership with Abu Dhabi Investment Council (ADIC), a
sovereign wealth fund owned by Abu Dhabi, the United Arab Emirates, the group
said.
Three prospective overseas buyers -- a sovereign wealth fund of the Middle East,
a U.S. builder and a Russian company -- submitted bids for the stake in the
nation's fourth-largest builder last Wednesday, Kumho Asiana said.
The bidding prices ranged from 20,000 won to 24,000 won per share, which places
the value of the deal at an estimated 3.3 trillion won, financial sources said.
Tokyo-based Nomura Securities Co. and the state-run Korea Development Bank, the
builder's main creditor, are arranging the sale.
Market watchers said it remains to be seen whether Kumho Asiana will ride out its
cash shortage, even though the deal is completed.
"The most important thing in the deal is the sale price per share of Daewoo
Engineering & Construction. And I'm not sure whether Kumho Asiana Group can break
out of its credit crunch through the stake sale because it is not known how much
the group can secure in cash by selling its other assets," said Cho Joo-hyung, an
analyst at Hanadaetoo Securities Co.
Another analyst, who asked not to identified, agreed with Cho, saying it is
believed that Kumho Asiana failed to secure enough cash through its asset sales.
The asset sale comes as the South Korean group has been plagued by cash shortages
since it bought a 72.11 percent stake in the builder in June 2006 for 6.42
trillion won, 3.5 trillion won of which was funded by banks and other financial
firms.
At the time, the group offered a put-back option, under which it promised the
financing providers it would buy back the builder's shares by December 2009 if
the stock price fell below 31,400 won.
Shares of Daewoo Engineering & Construction fell 1.42 percent to close at 13,900
won on the Seoul bourse on Monday.
ksnam@yna.co.kr
(END)
