Konglishman
Joined: 14 Sep 2007
Location: Nanjing
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 Posted: Fri Nov 18, 2011 5:17 am Post subject: Lone Star to be forced to Sell most of its KEB stake |
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Does anyone have any further information about this story?
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South Korea's financial watchdog Friday ordered US buyout fund Lone Star to sell the bulk of its stake in Korea Exchange Bank within six months, clearing the way for the country's biggest bank takeover.
The Financial Services Commission (FSC) said the Texas-based firm should lower its 51.02 percent holding in KEB to less than 10 percent by May 18, in a long-running case in which Lone Star's former Seoul head was convicted of stock price manipulation.
Friday's decision paved the way for Lone Star to quit its investment in South Korea and expedite the sale of KEB, the country's fifth-largest lender, to Korea-based Hana Financial Group.
Lone Star agreed last year to sell its KEB stake to Hana in a deal originally assessed to be worth $4 billion, but that was put on hold because of a long-running court case.
The FSC ruled Friday that the fund was unfit to be the major shareholder in KEB after an appeals court last month fined it $20.9 million and jailed its former Seoul chief for stock price manipulation, overturning a 2008 acquittal.
Lone Star bought a controlling stake in KEB for $1.2 billion in 2003 and a year later merged it with KEB's then-listed credit card unit.
Yoo was convicted of intentionally spreading market rumours that KEB Credit Services might reduce its capital and issue new shares, in an attempt to engineer a cheaper merger.
The court case thwarted Lone Star's attempts to sell KEB to Kookmin Bank in 2006 and to HSBC Holdings in 2008.
The FSC however rejected a request from activists and opposition parties for a public sale of Lone Star's stake.
The legal battle has been closely watched by foreign investors, with Lone Star claiming in the past that it was the victim of nationalistic sentiment.
The American Chamber of Commerce said in 2008 that Lone Star's legal troubles are scaring foreign investors away from Asia's fourth largest economy. |
http://news.yahoo.com/us-fund-ordered-sell-stake-korea-bank-094859309.html |
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