MBK Said to Pause 2016’s Biggest Asia PE Exit Amid China Tension

  • Chinese suitors stop work on bids after missile shield dispute
  • Buyout firm weighs seeking other buyers for ING Life Korea

MBK Partners has put plans to sell ING Life Insurance Korea Ltd. on hold after its Chinese suitors stopped working on their offers, people familiar with the matter said.

The North Asian buyout firm is exploring whether to seek other buyers for its ING Life stake, which could fetch about $3 billion, according to the people. Chinese bidders, including JD Capital and China Taiping Insurance Holdings Co., are unwilling to proceed with the deal without first being assured of their government’s support amid political tensions with Seoul, the people said, asking not to be identified because the discussions are confidential. 

A $3 billion sale would have been the biggest Asian exit by a private equity firm this year, according to data compiled by Bloomberg. Chinese billionaire Guo Guangchang’s Fosun International Ltd. was also among firms weighing a second-round bid for MBK’s controlling stake in ING Life, the people said.

Beijing was considering suspending some acquisitions in South Korea to pressure the government not to deploy a U.S. missile shield system, people familiar with the matter have said. MBK earlier this month had already given bidders more time to make second-round offers for ING Life amid frictions over the Terminal High-Altitude Area Defense system, known as Thaad, people said at the time.

The buyout firm bought ING Life in 2013 for about $1.6 billion, data compiled by Bloomberg show. The Chinese suitors could still resume discussions on a purchase of the insurer, the people said. 

An external spokesman for MBK Partners and a spokeswoman for Fosun declined to comment. Representatives for JD Capital and Taiping Insurance didn’t immediately respond to e-mails and phone calls seeking comment.

China’s Defense Ministry said Thursday the Thaad missile defense system breaks the strategic balance in the region and could hurt mutual trust between China and South Korea. South Korean President Park Geun Hye has defended the planned deployment of the Thaad shield, saying it’s a self-defense measure that shouldn’t be a subject of dispute. 

North Korea launched a ballistic missile Wednesday from a submarine off its east coast, showcasing technological improvements after it threatened a “pre-emptive” attack on South Korea for conducting joint military exercises with the U.S.

— With assistance by Jing Yang De Morel, Vinicy Chan, and Cathy Chan

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