Bloomberg News

Goldman Sachs Ends Hana Investment With $331 Million Sale

February 15, 2012

(Updates with comment from analyst in fourth paragraph.)

Feb. 14 (Bloomberg) -- Goldman Sachs Group Inc. sold its entire 3.9 percent stake in Hana Financial Group Inc. for 372 billion won ($331 million), exiting its seven-year investment in the South Korean bank.

The Wall Street firm sold 9.5 million shares in Hana for 38,950 won apiece, or a 3 percent discount from yesterday’s closing price, according to the terms of the transaction obtained by Bloomberg News today.

Goldman Sachs, which invested in Seoul-based Hana in 2005 and was once its biggest shareholder, has made at least 158 billion won on its investment, according to calculations made by Bloomberg News based on regulatory filings. Hana completed its biggest acquisition last week, buying Korea Exchange Bank for 4.4 trillion won from Lone Star Funds and Export Import Bank of Korea in an effort to narrow the gap behind KB Financial Group Inc. and Woori Finance Holdings Co.

“Goldman Sachs retained its Hana stake through its private- equity arm and there has been a concern that the fund will need to take profit eventually,” Choi Jung Wook, an analyst at Seoul- based Daishin Securities Co., wrote in a report dated today. “The sale will remove that overhang concern for Hana shares,” said Choi, who has a “buy” rating on the stock.

Hana shares rose 1 percent to 40,550 won at 1:03 p.m. in Seoul trading, after earlier declining as much as 2 percent. They closed at 40,150 won yesterday. The benchmark Kospi index slipped 0.2 percent today.

2005 Purchase

Goldman Sachs bought 18 million Hana shares for 537 billion won in 2005, when the Korean lender became a bank holding company, according to regulatory filings at the time. The New York-based firm sold 7.5 million of the shares for 322.5 billion won last April, according to terms of the deal. That sale plus the latest divestment amounts to 17 million shares offloaded for 694.5 billion won, a profit of 158 billion won.

Sale prices for other blocks of shares disposed by Goldman Sachs weren’t immediately available. Before the sale in April, Goldman Sachs held 18.3 million shares, or 8.66 percent of Hana, according to a regulatory filing.

Christopher Jun, a spokesman for Goldman Sachs in Seoul, declined to comment on the reason for the sale or how much profit the company made from the transaction.

Temasek Holdings Pte, Singapore’s state-owned investment company, sold 9.6 percent of Hana in October 2010 at a 6 percent discount.

--Editors: Russell Ward, Nathaniel Espino

To contact the reporter on this story: Seonjin Cha in Seoul at scha2@bloomberg.net

To contact the editor responsible for this story: Chitra Somayaji at csomayaji@bloomberg.net


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