Board to discuss on eurozone woes possible extension of KEB takeover deal
Hana Financial Group plans to hold an emergency board meeting as early as this week to conclude the issue on whether to extend the expiry date of a takeover deal with U.S. Lone Star Funds.
The initial contract between Hana and Lone Star to trade shares of Korea Exchange Bank expired on May 24 and they have all been entitled to break off the preliminary deal.
Hana Financial chairman Kim Seung-yu has continued to express his confidence in the expiry date extension.
“Talks with Lone Star are expected to be completed within this week,” he told reporters Wednesday. He also said the group is poised to make a public announcement once the negotiations are wrapped up.
“After sealing the extension, we plan to convene a board meeting this week to approve the deal extension.”
The chairman reiterated that he is positive on the outlook of his firm’s takeover of KEB, the fifth-largest bank in Korea.
But he did not elaborate on the financial conditions of the extension.
Lone Star reportedly wants to charge an additional 800 billion won for the controlling stake, given KEB’s April earnings from selling a stake in Hyundai Engineering & Construction.
Its efforts to renew the share purchase deal came as the Financial Services Commission indefinitely delayed regulatory permission for Hana’s KEB purchase.
Due to a pending court case over the U.S. buyout fund’s alleged wrongdoing in its 2003 purchase of a credit card unit affiliated with KEB, the financial authorities deferred its decision over whether Lone Star is legally eligible to become the biggest shareholder of KEB.
Reviewing the fund’s shareholder eligibility is deemed a prerequisite for the FSC to permit Hana’s transaction with Lone Star.
By Kim Yon-se (firstname.lastname@example.org