GIC, Canada fund among bidders for $1.4 billion Kyobo stakes: sources

Wed May 30, 2012 12:37am EDT
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By Jung Yoon Lee and Saeed Azhar

(Reuters) - Government of Singapore Investment Corp (GIC) and Canada's Ontario Teachers Pension Plan are among final bidders to buy stakes in South Korea's unlisted Kyobo Life Insurance, sources said, in deals worth up to $1.4 billion.

Daewoo International Corp 047050.KS and state-run Korea Asset Management Corp (KAMCO) are offering about a one-third stake in the life insurance company in two separate sales. The final bids for the stakes were made on Tuesday, the sources, who had direct knowledge of the matter, told Reuters.

Local media reported on Wednesday that Carlyle Group CYL.UL made a competing bid for the larger Daewoo stake.

GIC has teamed up with Affinity Equity Partners to buy the 24 percent stake in Kyobo held by Daewoo, one of the sources said, while Carlyle has bid with the United Arab Emirates sovereign wealth fund, the Korea Economic Daily reported.

Affinity and Ontario Teachers Pension Plan also submitted separate bids for KAMCO's 9.93 percent stake, a second source said. KAMCO was established to oversee non-performing assets in the Korean financial sector.

Bids reached as high as 250,000 Korean won per share, driving the value of Daewoo and KAMCO's stakes as high as 1.2 trillion won ($1 billion) and 500 billion won ($425 million), respectively, the Korean publication said.

The combined stake was valued at $1.8 billion in late April.

Foreign private equity funds must team up to control stakes larger than 10 percent, as under local laws foreign capital cannot own more than a one-tenth stake of a South Korean insurer without the regulator's approval.   Continued...