Jungheung, DS Networks consortium battle for Daewoo E&C Seller places priority on certainty of deal closing
Translated by Ryu Ho-joung 공개 2021-06-29 08:41:49
이 기사는 2021년 06월 29일 07:50 thebell 에 표출된 기사입니다.
The race to acquire Daewoo Engineering & Construction (Daewoo E&C) has become a two-way battle between Jungheung, a mid-sized construction firm, and a consortium led by real estate developer DS Networks, as Hoban Construction withdrew.Jungheung and the DS Networks-led consortium, which includes SkyLake Equity Partners and IPM Group, submitted binding bids for a 50.75% stake in Daewoo E&C held by KDB Investment on Friday, industry sources said.
Korea Development Bank (KDB)’s mergers and acquisitions division and BoA Securities are managing the sale process. The two bidders are set to pay a minimum deposit of 50 billion won ($44.3 million) upfront to guarantee that they are committed to the purchase, as requested by the seller prior to the bidding.
“The seller (KDB Investment and deal managers) apparently made it clear that they consider the certainty of the deal closing the most important factor in choosing the preferred buyer,” an industry insider said, adding that paying a greater deposit could give one bidder an edge over another by showing a stronger intention to acquire the target.
Hoban Construction decided not to submit a bid, probably because it needed to offer a bid much higher than competing bidders in order to win the race, after the company called off its planned acquisition of Daewoo E&C at the last minute in 2018.
“(Hoban) would have had to submit a much higher bid in order to make KDB believe that it won’t pull out of the deal this time, and that appears to be the reason that Hoban eventually withdrew,” the industry insider said.
The bids submitted by Jungheung and the DS Network consortium are expected to be little different, making how much they will pay for a deposit a more important factor in selecting the preferred bidder.
The bidders have been carrying out due diligence for the past few weeks, with a focus on Daewoo E&C’s overseas business. Three years ago, Hoban dropped its deal because Daewoo E&C revealed losses on its overseas projects after it was named as the preferred buyer.
“There were challenges involved in conducting due diligence as on-site visits are practically impossible due to the impact of the Covid-19 pandemic. The bidders may want to use that as leverage in negotiations with the seller,” said another industry insider. (Reporting by Seon-young Kim)
< 저작권자 ⓒ 자본시장 미디어 'thebell', 무단 전재, 재배포 및 AI학습 이용 금지 >
관련기사
best clicks
최신뉴스 in 전체기사
-
- [Company Watch]'재매각' 엑스플러스, 증자 추진 '사업기반 리셋'
- 덕산일렉테라, 미국 캐파 2배 증설
- [thebell note]‘이번엔 다르다’는 베트남
- 'ESG 집중' 대우건설, 기후변화 대응 리더 청사진
- 소프트아이텍, 국가암데이터센터 운영관리 사업 수주
- 대동, '2024 오늘과 내일의 농업' 이벤트 진행
- [ETF 위클리]중국 회복 기대감, 차이나항셍테크 ETF '불기둥'
- 민희진 보유 어도어 지분, 하이브 콜옵션 행사할까
- [IB 풍향계]'전통강자' NH·한투 위축…IPO 새 판 짜여진다
- [IB 풍향계]미래에셋, IPO 순위경쟁 '가속화'