Hana Financial Group and Lone Star Funds reached an agreement to extend a deal to buy Korea Exchange Bank within six months, Hana said Friday.

Hana, the nation’s No. 4 banking group, held a meeting of its board members later in the day to review the terms of the deal.

In November, Hana struck a deal with the U.S. buyout fund to acquire its controlling 51 percent stake in KEB for 4.69 trillion won ($4.33 billion).

Under the deal, Hana was supposed to complete the takeover by late May. But the plan had been delayed due to the financial watchdog’s decision to delay its review of the funds’ eligibility as the top shareholder of KEB.

In the negotiations to extend the deal deadline, Hana reportedly asked to lower the takeover price as KEB’s recent decision to pay out a record interim dividend is cutting the corporate value of KEB.

KEB’s board decided last week to pay out a quarterly dividend worth of 1,510 won per share, causing Lone Star to rake in dividends worth 496.9 billion won.

According to news reports in Seoul, Hana and Lone Star agreed to cut the price tag for the fund’s controlling KEB stake by 283 billion won ($266 million).
Last Friday, Hana also said in a regulatory filing that Hana Bank will lend 1.5 trillion won to Lone Star in loans backed by the U.S. company’s 51 percent stake in KEB.

By Cynthia J. Kim (cynthiak@heraldcorp.com)