KDB to Sell Daewoo Shipbuilding on Its Own

Fuente: Korea Times
By Yoon Ja-young
Staff Reporter

Korea Development Bank (KDB), which has been looking for a lead manager to replace Goldman Sachs, said it would sell Daewoo Shipbuilding & Marine Engineering on its own.

``We've tried to negotiate with Deloitte Anjin, the runner-up after Goldman Sachs, but they notified that they can't take the job,'' a spokesperson of the bank said in a press briefing, Tuesday.

Deloitte Anjin is known to have already made contracts with Hanwha and Doosan, potential bidders for the shipbuilder. Hence, the consulting firm had to drop the proposal from KDB due to conflicting interests.

KDB, the largest shareholder of the shipbuilder, had selected Goldman Sachs as the lead manager of the sale, but cancelled after finding out that it had invested in a Chinese shipbuilder.

As Daewoo had supplied submarine and other vessels to the Navy, there was concern about possible military technology leakage once Goldman Sachs took the deal. KDB hence requested Goldman Sachs to take measures to minimize any possible conflicting interests regarding its investment in the Chinese shipbuilder. Goldman Sachs, however, rejected the request.

KDB held a committee to select a lead manager, but failed to find a suitable company.

The committee decided the bank's mergers and acquisitions (M&A) team should manage the selling of its own stake in the shipbuilder, without an outside manager.

Some are pointing out that it doesn't look reasonable for KDB, the largest shareholder of Daewoo, to be the manager of the sale including its own stake. However, KDB said there is no problem. ``We have our own M&A team,'' the spokesperson said, adding that it has vast experience in managing such sales. ``It isn't obligatory to set an outside manager,'' the spokesperson said. KDB had no outside manager when it sold LG Investment & Securities. It also has vast advisory experience in other big deals, including the sale of the predecessors of STX Pan Ocean and Doosan Infracore.

Though KDB holds a stake in Doosan Heavy Industries and Construction and STX ― possible candidates to acquire Daewoo ― the spokesperson asserted ``There is no possibility of an interest conflict.''

The bank said experts from outside will be included in the committee to select the preferred bidder for Daewoo to enhance transparency in the sale.

``The preferred bidder will be selected before the end of August, as was first scheduled,'' it added.