South Korea’s Hana Financial Group will look to private equity firms to fund its $4 billion acquisition of Korea Exchange Bank, Reuters reported. Hana is in early talks with firms including The Carlyle Group and Kohlberg Kravis Roberts & Co., Reuters said, adding that Hana will tap private equity firms for roughly half the cost of the buyout.
(Reuters) – South Korea’s Hana Financial Group is in preliminary talks with private equity firms, including Carlyle Group [CYL.UL] and Kohlberg Kravis Roberts & Co (KKR.N), to fund its $4 billion acquisition of a majority stake in Korea Exchange Bank (004940.KS), sources said on Wednesday.
The board of Hana (086790.KS) signed the KEB deal on Wednesday and said it was considering options for financing [ID:nSEU003188]. The sources said Hana is expected to tap buyout funds for up to half the cost of the transaction.
Carlyle and KKR were among buyout firms in discussions to help finance the deal by buying stakes of up to 10 percent each in KEB, two sources familiar with the transaction told Reuters, adding that the talks are preliminary and it was uncertain whether the buyout funds will actually agree to a deal.
Other firms that might also get involved included TPG [TPG.UL], CVC [CVC.UL], and MBK and Pacific Alliance Group, another source said. The buyout firms were looking at individual stakes rather than acting as a consortium.
“It is safe to say there is a lot of private equity interest around the Korean banks,” one source familiar with the deal told Reuters.
A Carlyle spokeswoman declined to comment, while a KKR spokesman was not available for immediate comment. The other private equity funds also could not be reached immediately for comments. (Reporting by Michael Smith and Denny Thomas; Editing by Ken Wills)