Bloomberg News

Hana Jumps on Speculation KEB Purchase to Be Completed Soon

September 28, 2011

(Updates with analyst’s comment in fourth paragraph.)

Sept. 29 (Bloomberg) -- Hana Financial Group Inc. jumped as much as 11 percent in Seoul trading on speculation its acquisition of Korea Exchange Bank will be completed soon.

Hana, whose purchase of KEB from Lone Star Funds has been pending since November, climbed to 36,150 won and traded at 34,450 won as of 11:02 a.m. on the Korea Exchange. The benchmark Kospi Index slipped 0.9 percent.

South Korea’s financial regulator plans to order Lone Star to sell its KEB stake “without any strings attached” once the nation’s court delivers its verdict in the stock-manipulation retrial of the U.S. fund’s former local chief, DongA Ilbo reported today. Prolonged legal proceedings have been preventing regulators from approving Hana’s KEB stake purchase.

“Investors appear to be betting that Hana’s purchase will get the green light soon,” Andy Lee, a Seoul-based analyst with Taurus Investment & Securities Co., said by phone today. “The completion, if happens, will be good for Hana’s share price.”

South Korea will finalize the sale of KEB to Hana after a court decision in Lone Star’s case is made, Financial Services Commission Chairman Kim Seok Dong told reporters today. Further legal review will follow after the court decision, Kim said.

Prosecutors earlier this month asked the court to sentence Lone Star Funds’ former local chief Paul Yoo to 10 years in prison. The Seoul High Court is scheduled to make a ruling in the case on Oct. 6.

Lone Star in July agreed to extend a deadline to close the transaction until Nov. 30. Under the agreement, Hana is purchasing a 51 percent stake in Korea Exchange from Lone Star.

--Editor: James Gunsalus

To contact the reporters on this story: Saeromi Shin in Seoul at sshin15@bloomberg.net Seonjin Cha in Seoul at scha2@bloomberg.net

To contact the editors responsible for this story: Darren Boey at dboey@bloomberg.net Chitra Somayaji at csomayaji@bloomberg.net


Coke's Big Fat Problem
LIMITED-TIME OFFER SUBSCRIBE NOW

(enter your email)
(enter up to 5 email addresses, separated by commas)

Max 250 characters

 
blog comments powered by Disqus