Hana Fin seeks investors to fund $4.1 billion KEB buy

SEOUL (BestGrowthStock) – Hana Financial Group (086790.KS: ) said on Thursday it was seeking a number of foreign investors each willing to buy up to 9 percent of its shares worth about $650 million at its current share price to fund its $4.1 billion acquisition of Korea Exchange Bank (004940.KS: ).

Hana, South Korea’s fourth-largest financial services firm by assets, is searching for ways to finance the country’s biggest ever banking acquisition, including a rights offering, with a view to conclude the deal in the first quarter of 2011.

“We aim to minimize the size of share sale and we are also considering other types of fund raising,” a Hana spokesman quoted its chairman Kim Seung-yu as saying.

Sources told Reuters earlier that Hana was in preliminary talks with private equity firms including Carlyle Group (CYL.UL: ) and Kohlberg Kravis Roberts & Co (KKR.N: ) to fund the KEB takeover.

Shares in Hana, which counts Goldman Sachs (GS.N: ) as its top shareholder with 8.66 percent, closed up 5.7 percent on Thursday at a one-year high of 40,900 won, easily beating a 1.7 percent gain in the wider market (.KS11: ).

It was buoyed by expectations that the purchase of KEB, South Korea’s top foreign exchange specialist, will strengthen its competitiveness in the banking sector.

Hana had agreed last month to buy a 51 percent of KEB from U.S. private equity fund Lone Star (LS.UL: ).

(Reporting by Ju-min Park; Editing by David Chance)

Hana Fin seeks investors to fund $4.1 billion KEB buy