Woori Financial Privatization Accelerates... 18 Investors Participate in Bidding War

Exterior view of the Korea Deposit Insurance Corporation headquarters

[Asia Economy Reporter Song Seung-seop] The privatization process of Woori Financial Group is expected to accelerate as the Korea Deposit Insurance Corporation (KDIC) has decided to sell its remaining shares in Woori Financial Group.

According to the financial sector on the 9th, KDIC received letters of intent (LOI) by 5 p.m. the previous day in accordance with the "Woori Financial Group Remaining Shares Sale Announcement," which was announced on the 9th of last month.

A total of 18 investors, including financial companies, private equity funds, and foreign investors, participated in this acquisition battle. Some investors proposed desired acquisition volumes, which amounted to 4.8 to 6.3 times the total sale volume (10%). It is known that KT, Hoban Construction, Woori Employee Stock Ownership Association, and Eugene PE participated in this bidding. However, KDIC announced that it cannot disclose individual investors or volumes.

KDIC acquired shares in Woori Financial Group during the financial sector restructuring amid the 1998 International Monetary Fund (IMF) foreign exchange crisis. The privatization process began in 2019 when the Financial Services Commission announced a "Woori Financial Remaining Shares Sale Roadmap," planning to sell shares in installments by 2022. Initially, the plan was to sell 10% shares multiple times, but due to the sharp drop in stock prices caused by COVID-19, the sale was delayed. Then, on the 4th, the stock price hit a 52-week high, and 14.44 million shares were sold.

This time, 10% of the 15.13% stake held by Woori Financial Group will be sold. If this sale is successful, KDIC will lose its status as the largest shareholder and its right to recommend non-executive directors. This effectively means the complete privatization of Woori Financial Group.

Investors selected as qualified bidders according to the method approved by the Public Fund Management Committee on the 7th will be granted due diligence opportunities from the 18th onward. The submission of bid proposals will close on the 18th of next month, and four days later, bidders will be evaluated and the successful bidder selected, completing the sale process within the year.

However, the above schedule may change depending on progress, and some investors may require additional Financial Services Commission approval after the successful bidder is selected.