KDB Moves to Sell Hanwha Ocean Stake Worth 5 Trillion Won

Korea Development Bank (KDB) is moving to sell its stake in Hanwha Ocean.

According to industry sources on April 28, KDB began a book-building process on the same day to gauge investor demand for a block deal sale of its Hanwha Ocean shares.

KDB currently holds 59,738,211 shares of Hanwha Ocean, representing a 19.50% stake. KDB acquired its shares in the predecessor of Hanwha Ocean, Daewoo Heavy Industries, through a debt-to-equity swap in 2000.

The largest shareholder of Hanwha Ocean is Hanwha Group, including affiliates such as Hanwha Aerospace and Hanwha Systems. Hanwha Group and its special affiliates collectively hold a 46.28% stake.

KDB is believed to have decided to sell its shares after a sharp rise in Hanwha Ocean's stock price, driven by a recent improvement in the shipbuilding industry.

Hanwha Ocean's share price, which was in the 27,000 won range in November last year, closed at 89,300 won per share as of the end of trading on this day. Based on this price, the value of KDB's stake amounts to 5.3 trillion won. Given the large size of the stake, KDB is reportedly considering a partial sale rather than a full divestment.

If the sale is completed, KDB's capital adequacy is also expected to improve significantly. KDB's Bank for International Settlements (BIS) capital adequacy ratio stands at 13.9%, which is considered low among domestic banks.