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Daewoo E&C to Announce Sale Details at End of Sept.
Beginning Selling-off Procedure
Daewoo E&C to Announce Sale Details at End of Sept.
  • By Jung Min-hee
  • September 26, 2017, 03:15
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The sale procedure of Daewoo Engineering and Construction will be started at the end of this month.
The sale procedure of Daewoo Engineering and Construction will be started at the end of this month.

 

The Korea Development Bank (KDB), the largest shareholder of Daewoo Engineering & Construction Co., will begin the sale procedure at the end of this month and select a preferred bidder by the end of this year.

According to investment banking industry sources and Daewoo E&C on September 22, the KDB internally reviewed due diligence report from the lead manager for the sale on September 22 and plans to announce the sale details as early as September 28. The KDB will select a preferred bidder by the end of this year and complete the deal after settling the balance in the first half of next year.

Currently, there are 10 potential buyers including Saudi Arabia’s sovereign wealth fund Aramco and Malaysia’s Petronas as well as some Middle Eastern and Indian companies. The KDB indirectly owns a 50.75 percent stake in Daewoo E&C through private equity fund investment firm “KDB Value 6.”

The industry believes that the selling value is the major variable of the Daewoo E&C sale. Considering the increase of management right premiums due to the performance improvement, the sale value will be around 2 trillion won (US$1.76 billion).

Accordingly, foreign capital is expected to become a new owner of Daewoo E&C, instead of domestic firm, because of the high price. An industry from the construction industry said, “The key is to seek out a company that cam properly assess the future value of Daewoo E&C and provide the vision for growth.”