Korea Development Bank (KDB) will push for a seventh sale of KDB Life Insurance since 2014. The leading acquisition candidates are Korea Investment Holdings and Taekwang Group. Korea Development Bank (KDB) plans to select a preferred bidder in the third quarter of this year and close the transaction within the year.
According to the financial sector on the 23rd, Korea Development Bank (KDB) plans to issue a public tender notice on the 24th and begin the sale process. In this sale, Korea Development Bank (KDB) will transfer its entire 99.66% equity in KDB Life Insurance through an open competitive bidding process. Samil PwC is the sale manager, and Kim & Chang is providing legal advice.
Korea Development Bank (KDB) will sell all its shares but left open the option of considering preemptive capital raising if the acquirer wants it. In Dec. last year, Korea Development Bank (KDB) carried out a paid-in capital increase of 500 billion won for KDB Life Insurance. KDB Life Insurance's risk-based capital ratio (K-ICS; Korean Insurance Capital Standard) rose from 165.2% at the end of September last year to 205.7% at year-end. This exceeds the financial authorities' recommended level of 130%. The asset size amounts to 17.2045 trillion won.
Recently, Korea Investment Holdings has been cited in the market as a leading candidate. Korea Investment Holdings has no insurance affiliate. If it acquires KDB Life Insurance, it can strengthen its comprehensive financial system by extending from a group centered on securities and asset management to insurance. Taekwang Group could aim to expand its business through additional insurer acquisitions if it acquires KDB Life Insurance on top of its existing Heungkuk Life Insurance.