Hanwha throws its hat in Woori bid

Hanwha Life announced Thursday that it would participate in buying Woori Bank’s shares, just a day before the deadline to submit a letter of intent.

The government has announced a plan to privatize Woori by splitting a 30 percent stake held by the state-run Korea Deposit Insurance Corporation into shares of four to eight percent, depending on demand from bidders.

According to industry insiders, Hanwha is interested in buying 4 percent of Woori’s shares, and the market price is expected to be around 300 billion won ($270 million).

“We are participating in the deal and expect it to be our long-term investment,” a Hanwha spokesperson said.

Kyobo Life Insurance, on the other hand, announced it would not participate in buying Woori’s shares and said it was risky to invest large amounts of money in one company.

Kyobo was once considered the strongest bidder back in 2014 when the government made an attempt to privatize Woori, but right before the official bidding process began, it decided not to participate.

Industry insiders expect around 10 more institutions, both foreign and local, to submit a letter of intent on Friday.

“There are a number of companies who showed interest in buying eight percent shares, and we expect our preliminary bidding to become very successful,” said Lee Kwang-goo, CEO of Woori Bank.

The Korea Deposit Insurance Corporation currently holds 51.06 percent share in Woori Bank.

The government last month announced its plan to privatize the bank, its fifth attempt to do so since first announcing the plan back in 2010.

Bidding will close some time in November, and the winning bids will be announced during the same month, according to the Financial Services Commission.

Investors who buy a proposed four to eight percent stake will be entitled to recommend outside directors as well as the head of Woori Bank.

BY KIM YOUNG-NAM [kim.youngnam@joongang.co.kr]