Woori Financial Group finally 'privatized' after 23 years - Korea Times
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Woori Financial Group finally 'privatized' after 23 years

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Woori Financial Group headquarters in central Seoul / Courtesy of Woori Financial Group
Woori Financial Group headquarters in central Seoul / Courtesy of Woori Financial Group

Five entities take over KDIC's 9.3 percent stake in Woori Financial Group

By Anna J. Park

The state-run Korea Deposit Insurance Corporation (KDIC) announced Monday that it had selected five firms to buy nearly 10 percent of its shares in Woori Financial Group. The five are Eugene Private Equity, KTB Asset Management, the Align Partners Consortium, Dunamu and the Woori Employee Stock Ownership Union. With the stake purchase, Woori Financial Group will be fully privatized ― under Korean law ― 24 years after it received 12.8 trillion won in government funding shortly after the 1997 Asian financial crisis.

According to the Financial Services Commission (FSC), the country's top financial policy regulator, and the KDIC, the latter will sell 9.3 percent of its shares in Woori Financial ― 4 percent to Eugene Private Equity, 2.3 percent to KTB Asset Management, and 1 percent each to Align Partners, Dunamu and the Woori Employee Union.

The five were among nine bidders that participated in a bidding process that took place last Thursday. They all submitted offers of more than 13,000 won ($10.95) per share, which is higher than a block sale in April, when the KFIC sold 2 percent of its stock for 10,335 won per share.

The shares will be transferred to the successful bidders Dec. 9, when they complete payment for them. About 897 billion won worth of government funding will be retrieved through the sale, meaning the government will have retrieved 96.6 percent of the funds, or 12.3 trillion won out of 12.8 trillion won, it pumped into Woori Financial Group.

Reflecting expectations for full privatization, Woori Financial's share price closed up 1.91 percent Monday at 13,350 won. Although this was lower than its 52-week high of 13,700 won set Oct. 28, the price rose mainly due to strong buying from overseas and institutional investors.

With sale, KDIC reduced to third-largest shareholder of Woori Financial Group

After the sale, KDIC will still hold 5.8 percent of the group's shares, leaving it as the third-largest shareholder behind the Woori Employee Stock Ownership Union with 9.8 percent and the National Pension Service with 9.42 percent.

"Once the sale is over, a private shareholder will be the largest in Woori Financial Group, and the group will have achieved complete privatization after 23 years," the FSC said. "It will be a de facto privatization, which will eliminate the discount factor suffered by the group as it is now no longer government-owned."

The KDIC plans to sell its remaining 5.8 percent stake in the future dependent on the share price. To fully retrieve the government's investment it needs a stock price of over 10,193 won per share.

Park Ji-won annajpark@koreatimes.co.kr

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