Hana remains dedicated to save bid for KEB

The lender fights for KEB takeover as it zeroes in on the move to further its growth.

Hana Financial Group Inc. tumbled the most since its listing in December 2005 after Chairman Kim Seung-yu expressed concern his $4.3 billion bid for Korea Exchange Bank may fail as regulators delay approval.

Hana, Korea’s fourth-largest financial company by assets, plunged by the daily 15 percent limit to close at 37,850 won ($34.82) in Seoul, while Korea Exchange Bank rose 13 percent to 9,950 won.

Hana will seek an extension from Lone Star Funds on a May 24 deadline to complete the transaction and consider buying back shares, Kim told reporters Saturday.

The lender aims to alleviate investors’ concern that its failure to buy Lone Star’s stake in Korea Exchange Bank may hobble its bid to close the gap with larger rivals including Woori Finance Holdings Co.

“No takeover means no growth potential for Hana,” said Song I-jin, head of equity at HI Asset Management Co. “Investors had anticipated Hana will overcome its handicap of being small scale by buying KEB. If the deal falls through, it’ll remain a minor player.”

Hana’s board on Saturday decided to contact Dallas-based Lone Star to extend the May 24 deadline on the takeover, Kim said. The Financial Services Commission’s “decision was quite unexpected,” Kim said. “We’ll do all we can to make this deal happen.”

View the full story in JoongAng Daily.