[THE INVESTOR] GE Capital, financial services unit of the US conglomerate General Electric, is in final-stage talks to sell its stake in Korea’s Hyundai Card and Hyundai Capital, to unwind a decade-old joint venture relationship that it formed with Hyundai Motor. 

As a part of GE’s move to shift away from consumer finance globally, GE Capital plans to sell its 43 percent stake worth 760 billion won (US$ 650 million) in the credit card business to several private equity funds by splitting the stake into blocks of 10 percent each.

Goldman Sachs and Morgan Stanley, which manage the deal, received letters of intent from a prospective buyer on June 10. Financial investors including Affinity Equity Partners, CVC Capital Partners and H&Q Asia Pacific Korea are allegedly submitted proposals.

If four to five companies buy the 43 percent stake in Hyundai Card separately, the deal size would be around 150 to 200 billion won for each. 

Meanwhile, GE Capital is struggling to find a potential buyer for its 20 percent stake in Hyundai Capital, an auto financing firm and 12-year-old joint venture. Industry experts said Hyundai Motor is likely to reacquire the shares.

Of the 43.3 percent stake owned by GE in the joint venture, Hyundai Motor and affiliate Kia Motors picked up 23.3 percent stake for US$600.8 million in January, 2016.

GE has a put option contract that it can sell remained shares in Hyundai Capital to Hyundai Motor at a fixed price if it fails to draw potential investors by the end of June for a higher price.

By Park Han-na (hnpark@heraldcorp.com)