이 기사는 2021년 06월 04일 07시58분 thebell에 표출된 기사입니다

Korea Development Bank (KDB) is likely to able to put a higher price tag on Daewoo E&C than three and a half years ago when the state-controlled bank first attempted to sell off the builder, as the company’s share price increased nearly 40% during this period.

KDB Investment, the lender’s investment arm, has named KDB’s mergers and acquisitions division, BoA Securities and accounting firm EY Hanyoung as advisers to help it to sell Daewoo E&C, according to industry sources.

They are expected to have a kick-off meeting soon to discuss the timeline of an auction process and also to set a floor sale price.

In 2010, KDB acquired a 50.75% stake in Daewoo E&C and provided a capital injection to normalize the company’s operations, with total capital invested in the builder amounting to 3.2 trillion won ($2.9 billion).

KDB’s first attempt to sell off the company was in 2017. The bank informed potential buyers of Daewoo E&C that a floor price was set at 10,000 won per share. But KDB had to lower its price expectations to between 7,300 won and 7,500 won per share after the company’s stock price slumped to the 5,000 won range.

Hoban Construction, which was named as the preferred bidder in that year, agreed to pay 7,600 won per share after applying a control premium of roughly 29%. The price represented a 1.62 trillion won valuation for a 50.75% stake in Daewoo E&C, although the deal ultimately fell through in early 2018.

However, situations have changed. Daewoo E&C’s stock price has shown a positive upward trend since the start of this year. Its shares closed at 8,350 won on Tuesday, rising above the 8,000 won level for the first time since 2014.

Industry watchers expect Daewoo E&C could easily fetch a valuation of 10,000 won per share, which KDB initially targeted three and a half years ago, this time given the company’s average stock price for May of 7,600 won and a 30% control premium. This sale price would value a 50.75% stake in the company at 2.1 trillion won.

“KDB is likely to set a floor sale price for Daewoo E&C at between 8,500 won and 9,000 won considering the improvement in the company’s financial position and a bullish stock move,” an industry insider said, but adding, “Any findings in due diligence could affect the sale price.”

Several potential buyers have so far shown interest in buying a controlling stake in Daewoo E&C, including a consortium led by real estate developer DS Networks, Jungheung Construction, private equity firm Hahn & Company and China’s state-owned builder China State Construction Engineering Corporation. (Reporting by Jin-young Ko)