UPDATE 2-Hanwha hires JPMorgan to sell Korea Life stake

miércoles 17 de septiembre de 2008 12:05 CEST

(Adds analyst comment, background)

By Michael Flaherty

HONG KONG, Sept 17 (Reuters) - Hanwha Group has hired investment bank JPMorgan (JPM.N: Cotización) to sell a 9.9 percent stake in its Korea Life insurance unit, sources said on Wednesday, in a deal that could value the firm at more than $7.5 billion.

Affinity Equity, Carlyle Group and MBK Partners are among several private equity firms interested in the stake, three sources with direct knowledge of the deal told Reuters. Hanwha is targeting $500 million to $750 million from foreign investors.

Hanwha has previously set out plans to publicly list the life insurance company. A minority stake sale to a foreign investor would not only help give Korea Life a pre-IPO valuation, but would raise cash for Hanwha's bid for a stake in Daewoo Shipbuilding & Marine Engineering (042660.KS: Cotización).

The Daewoo Shipbuilding deal is expected to fetch up to $8 billion. Hanwha's ability to finance a bid is seen as relatively weak compared to its rivals.

"We don't have a firm plan for such a deal yet," Ju Cheol-beom, a Hanwha Group spokesman, said, referring to the Korea Life stake sale.

But sources involved in the process said that private equity firms are already poring over bid-related documents in an auction that will likely kick off in the next couple of weeks.

So far, the process has focused on foreign private equity firms because of the size of the stake on offer. A more than $500 million cheque would fit well with the kind of cash big buyout firms are willing to pay in Asia.   Continuación...