A series of M&A deals follow one after another in the South Korean investment banking industry from September 20, when the sale of Kumho Tire is scheduled to kick off. The preliminary bidding and the final bidding for the 42.1% shares owned by the creditors including the Korea Development Bank are scheduled for mid-November and January 2017, respectively.
The submission of letters of intent (LOIs) regarding Woori Bank is until September 23. The South Korean government is planning to sell 30% of the bank to multiple investors and then sell the remaining 18%. According to industry sources, those interested in the bank include the Korea Federation of Community Credit Cooperatives, Kyobo Life Insurance, Hanwha Life Insurance and private equity funds (PEFs) such as MBK Partners.
The main bidding for Dongyang Magic is scheduled for September 27. At present, the shortlist consists of three financial investors (FIs) – CVC Capital Partners, STIC Investments and Bain Capital – and five strategic investors (SIs) such as SK Networks, CJ O Shopping and Hyundai Department Store. The former are looking to participate in the bidding by forming consortiums with the latter as the seller is focusing on the continuation of employment and this means the former have a slim chance without the latter.
Logen Logistics and PCA Life are to sign stock purchase agreements late this month and next month, respectively. CVC Capital Partners, the preferred bidder for the former, has suggested a price of 300 billion won or so, somewhat lower than the seller’s expectations. PCA Life is to conclude the agreement after selecting Mirae Asset Life Insurance or a Chinese SI as the preferred bidder. McDonald’s is planning to select a preferred bidder within this month, too. The most promising candidates include the Carlyle-Maeil Dairies consortium, KG Group-NHN Entertainment consortium and Texas Pacific Group.
The sale of Hyundai Cement is scheduled to be initiated in early October. A number of PEFs are interested in the company as the cement industry is expected to show a turnaround soon and Hyundai Cement is capable of stable profit generation.
Sizeable initial public offerings (IPOs) are around the corner as well. Doosan Bobcat, which is expected to attract 2.45 trillion won, submitted its securities registration statement on September 8 for IPO process initiation. Demand forecasting is scheduled for October 6 and 7 and general cash offer is to be underway from October 12 to 13. This process is to be followed by IPOs on the part of major biotech companies such as Samsung Biologics and Celltrion Healthcare. With that of Hotel Lotte postponed, institutional investors are likely to concentrate more on these companies.