Korea Express Shareholders Said to Seek up to $1.8 Billion From Stake Sale
Daewoo Engineering & Construction Co. and Asiana Airlines (020560) Inc. aim to raise as much as 2 trillion won ($1.8 billion) from the sale of a controlling stake in Korea Express Co., according to a person familiar with the situation.
Posco (005490), Lotte Group and CJ Group expressed interest today in buying the stake of about 40 percent in the logistics company, said the person, who declined to be identified as the information is private. Posco, South Korea’s biggest steelmaker, and Lotte separately confirmed their interest. CJ Group declined to comment in an e-mail when contacted by Bloomberg News.
Daewoo E&C and Asiana want to sell Korea Express shares for as much as 200,000 won apiece, the person said, which is 81 percent more than today’s closing price. The winning bidder will get control of a company with terminals in South Korea’s busiest ports, a nationwide network of about 10,000 express-delivery outlets and a fleet of more than 5,000 trucks.
“Acquiring Korea Express will definitely be a plus because of its distribution network in the country as well as overseas,” said Shin Ji Yoon, a KTB Securities Co. analyst in Seoul. “The sale is gaining a lot of interest and that could probably push offer prices higher.”
Asiana, South Korea’s No. 2 airline, declined to comment in a text message sent to Bloomberg News today. It referred calls to Korea Development Bank, which is arranging the sale. Daewoo E&C similarly referred calls to the bank, which is also its parent. Park Chan Ho, a spokesman for the lender, declined to comment.
Korea Express, based in Seoul, advanced 5.7 percent, the biggest gain since Feb. 7, to close at 110,500 won in the city. The stock has almost doubled in the past 12 months, compared with a 24 percent gain for South Korea’s benchmark Kospi index.
Asiana advanced 2.9 percent to close at 10,500 won in Seoul. Daewoo Engineering rose 3.6 percent to 11,550 won. Both companies own 24 percent of Korea Express, the nation’s biggest logistics company.
Shinsegae Co., South Korea’s biggest operator of discount stores, scrapped plans to bid for control of Korea Express, said spokesman Hwang Jong Soon. He declined to elaborate. The sale may be completed by the end of June, Korea Development Bank Chief Executive Officer Min Euoo Sung said in January.
Daewoo E&C was an affiliate of Asiana until it was taken over by creditors last year. Parent Kumho Asiana Group lost control as it struggled to repay debts stemming from its 2006 acquisition of the construction company. Kumho Asiana in January 2010 said that it planned to raise 1.3 trillion won from asset sales.
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