Hillhouse Responds to Heungkuk's Criticism in IGIS Acquisition: "We Only Followed Sale Manager's Rules"

Hillhouse Remains Silent on Prior Agreement for 'Progressive Deal'
Emphasizes Commitment to Long-Term Management
Heungkuk Life Insurance Signals Legal Action
Criticizes "Joint Venture of Chinese Capital and Sale Managers"

Hillhouse Investment, a Chinese private equity fund manager selected as the preferred bidder for the acquisition of IGIS Asset Management, has responded to criticism from Heungkuk Life Insurance. However, the firm remained silent on the most contentious issue: the bidding process itself.

On December 10, Hillhouse released a statement saying, "We have strictly adhered to the standards and regulations set by the sale manager throughout the entire process," and added, "As investors who prioritize sustainable growth over short-term profits, we will continue to support IGIS Asset Management's growth from a long-term perspective."

The firm also emphasized, "By combining IGIS's expertise and market insight with Hillhouse's global network and know-how, we believe we can create larger and more dynamic business opportunities." However, Hillhouse did not specifically address the 'progressive deal' method criticized by Heungkuk Life Insurance.

Previously, Heungkuk Life Insurance criticized the selection of the preferred bidder, claiming it was a joint effort between the sale managers (Goldman Sachs and Morgan Stanley) and the Chinese private equity fund. In the main bid on November 11, Heungkuk Life Insurance offered 1.05 trillion won, but Hillhouse raised its bid to between the mid-900 billion won range and approximately 1.1 trillion won, thereby outbidding Heungkuk Life Insurance. Because this deal was conducted as a 'progressive deal,' it effectively allowed for additional price increases, similar to a second round of bidding.

As a result, Heungkuk Life Insurance criticized the sale process as being neither fair nor transparent. The company pointed out that both the shareholder representative and the sale managers had initially declared that there would be no progressive deal after the main bid. Heungkuk Life Insurance stated, "After the main bid, the sale managers repeatedly delayed the announcement of the preferred bidder, then proposed a progressive deal to Hillhouse, requesting a higher acquisition price," and added, "We also suspect that the amount we bid may have been leaked during this process."

Heungkuk Life Insurance has announced that it will take all possible measures, including legal action. The company stated, "This is a joint venture created by a Chinese private equity fund targeting Korea's real estate investment platform and foreign sale managers blinded by huge performance fees," and criticized, "This incident has gone beyond the limits of the seller's discretion and undermined the trust and order of our capital market."

Hillhouse is a global asset manager founded by Zhang Lei, who is originally from Henan Province, China. Zhang majored in international finance at Renmin University of China and earned his MBA from Yale University. He grew the firm by investing in major Chinese tech companies such as Tencent and JD.com. Although Zhang holds Singaporean citizenship and Hillhouse is headquartered in Singapore with investments from institutional investors worldwide, it is widely believed that the firm is still significantly influenced by Chinese capital.