A Seoul, South Korea, court ruled Thursday that Dallas-based private equity firm Lone Star was guilty of manipulating stock prices in connection with a Korea Exchange Bank unit, Reuters reported Thursday. The ruling is in connection to Lone Star’s proposed deal to sell 51% of KEB to Hana Financial Group for $4.1 billion.
(Reuters) – A Seoul court ruled on Thursday that U.S. buyout fund Lone Star was guilty of manipulating stock prices in connection with a Korea Exchange Bank (KEB) unit, clearing a major legal hurdle to the fund’s $4.1 billion deal to sell KEB to domestic rival Hana Financial Group.
The Dallas-based firm agreed to sell a 51 percent stake it holds in South Korean lender KEB to Hana for $4.1 billion, but legal uncertainties forced regulators to hold off approval for what could be the country’s biggest banking acquisition.
The Seoul High Court said LSF-KEB Holdings SCA, Lone Star’s Belgium-based unit which owns a controlling stake in KEB, and Paul Yoo, the ex-head of its Korean operations, were guilty of stock price manipulation. (Reporting by Hyunjoo Jin; Editing by Jonathan Hopfner)