The Korea Deposit Insurance Corporation (KDIC), which is pushing to sell YeByeol Non-Life Insurance (formerly MG Non-Life Insurance), has delayed the main bidding schedule by one week. The KDIC is considering switching to a private contract format if only one financial company participates in the main bid.
According to the insurance industry on the 10th, the KDIC postponed the timing of the main bid for YeByeol Non-Life Insurance from the 30th of this month to Apr. 6. It was reported that the simple schedule delay has not caused issues in the sale process, including due diligence.
Three parties participated in the preliminary bid for YeByeol Non-Life Insurance: Hana Financial Group, Korea Investment Holdings, and the U.S.-based private equity fund JC Flowers. All three are conducting due diligence. The due diligence is scheduled to run until the 20th.
If only one financial company participates in the main bid, the KDIC plans to issue a new notice. It will skip the preliminary bidding process and select a preferred bidder by finding a financial company to participate directly in the main bid. If no prospective acquirer emerges even after the new notice, the KDIC plans to proceed with a private contract with the single financial company that participated in the main bid.
The KDIC will finalize the support amount right before the main bid. A company acquiring a troubled financial firm can apply to the KDIC for funding support at the time of the main bid. The sale process proceeds only if the requested support amount from the prospective buyer is within the support amount (reserve price) set by the KDIC.
It is uncertain who will participate in the main bid for YeByeol Non-Life Insurance. There is talk that Hana Financial Group will not participate in the main bid. JC Flowers participated in the preliminary bid and completed due diligence in the 2024 public sale of MG Non-Life Insurance but did not participate in the main bid. Korea Investment Holdings has a strong intention to acquire an insurer, but it may turn to another insurance company that has come up for sale.