Two of this year’s most anticipated corporate sales are to enter the final round of bidding in the coming days, but from the way things look now, they may be in for quite different outcomes.
The race to take over Hyundai Securities is heating up, with the joining of another strong contender. Meanwhile, Kim’s Club, being put up for sale by E-Land Group, appears to have failed in drumming up interest from potential buyers, industry sources and local reports said.
Hyundai Securities (Yonhap)
KB Financial Group, Korea Investment Holdings and Mirae Asset Financial Group, which competed in last year’s takeover bid for KDB Daewoo Securities, are to face off again for the smaller brokerage unit of Hyundai Group.
Mirae Asset, the winner of the KDB Daewoo race, has reportedly decided to invest about 500 billion won ($430 million) in LK Investment Partners private equity, one of the six preliminary bidders for Hyundai Securities.
If Mirae acquires Hyundai via the private equity fund, it will become a mammoth in Korea’s fragmented brokerage sector, with total assets of nearly 9 trillion won. Hyundai Securities has 3.2 trillion won in assets.
The deadline for the six bidders to make binding offers for the 22.56 percent stake in the firm being sold is extended by one day to Friday.
On Tuesday, E-Land Group is to open final bids for Kim’s Club, a 37-branch hypermarket franchise with annual revenue of around 1 trillion won, but deal watchers say only one bidder -- U.S.-based private equity firm KKR -- is likely to participate.
Out of the 10 groups which expressed interest, the group had chosen three as preliminary bidders, which it said included at least one strategic investor engaged in the local retail business. Major retail groups in Korea, including Shinsegae, Lotte and Hyundai Department Store -- denied their participation.
E-Land is selling the franchise to ease a liquidity crunch.
To drum up interest from potential buyers, it earlier decided to put a flagship and highly profitable department store in southern Seoul on offer along with the hypermarket chain, but has recently scrapped the plan.
By Lee Sun-young (milaya@heraldcorp.com)