Government may launch fresh round of bidding process to find investor


MBK Partners submitted a preliminary bid for a stake in Woori Financial Group on Wednesday, becoming the sole bidder among the three potential private equity funds.

The other two contenders ― Vogo Fund and T-Stone ― dropped out of the competition despite their earlier submission of letters of intent.

At issued is whether the government will select MBK Partners as the preferred negotiator, a single bidder with no rival goes against the law which stipulates the requirement of “workable competition” in sale of state-owned companies.

Financial Services Commission officials are reportedly considering making a private contract with a particular investor or launching another bidding processes.

Vogo Fund having recently failed to form a consortium with Korea Investment Holdings taking part as a strategic investor, the private equity fund appears unlikely to be able to find another investor on time.

The already delayed process of privatizing Woori Financial appears to likely to take another turn for the worse as rumors continue to circulate about the private equity fund’s plans to pull out, industry watchers said.

At the beginning of the process in October 2010, the government set out with the aim of maximizing profits, early privatization and aiding the advancement of the country’s financial sector in selling its stakes in Woori Financial Group.

However, the chances of the government achieving any of the three goals appear to be getting slimmer as time passes.

While the government had first received letters of intent in November, the process of finding a new owner for its stakes in Woori Financial was halted with bidders pulling out.

By Kim Yon-se (kys@heraldcorp.com)