Bloomberg News

Posco-Samsung, CJ Submit Korea Express Bids; Lotte Drops Out

June 27, 2011

June 27 (Bloomberg) -- A Posco-Samsung Group venture and CJ Group made final bids for a stake in Korea Express Co. as they compete for control of South Korea’s biggest logistics company.

Posco, the nation’s biggest steelmaker, and Samsung unit Samsung SDS Co. filed their bid ahead of today’s deadline, Chung Jae Woong, a Posco spokesman, said by phone, declining to elaborate. Foodmaker CJ Group didn’t reveal its offer in a statement confirming that it had made a bid.

The groups are the only bidders left after Lotte Group dropped out today following Korea Express’s sale of three units in a separate deal. Asiana Airlines Inc. and Daewoo Engineering & Construction Co. intend to raise as much as 2 trillion won ($1.8 billion) from selling about 40 percent of Seoul-based Korea Express, a person familiar with the matter said in March.

“Buying Korea Express will help lower logistics costs,” said Yoon Gwan Cheol, an analyst at Hanyang Securities Co. in Seoul. The company “has the best infrastructure and network in the country.”

Korea Express has terminals in South Korea’s busiest ports, a nationwide network of about 10,000 express-delivery outlets and a fleet of more than 5,000 trucks, according to its website.

The company dropped 4.7 percent to close at 130,500 won in trading in the city. The stock has risen 39 percent this year, compared with a 0.9 percent gain for the benchmark Kospi index. A 40 percent stake would be worth about 1.19 trillion won at today’s closing price, according to Bloomberg data.

Asiana and former affiliate Daewoo Engineering both own 24 percent stakes in Korea Express. Korea Development Bank and Nomura Holdings Inc. are arranging the sale.

--With assistance from Sangim Han and Jun Yang in Seoul. Editors: Neil Denslow, Terje Langeland

To contact the reporters on this story: Kyunghee Park in Singapore at kpark3@bloomberg.net

To contact the editor responsible for this story: Neil Denslow at ndenslow@bloomberg.net


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