Hana Financial Group pulls out of KDB Life Insurance acquisition

Hana Financial Group has withdrawn its bid to acquire KDB Life Insurance, the group confirmed on Wednesday.

Hana Financial Group office in central Seoul [HANA FINANCIAL GROUP]

Hana Financial Group has withdrawn its bid to acquire KDB Life Insurance, the group confirmed on Wednesday.

The decision was made three months after Hana was named the preferred bidder to acquire 92.73 percent of the insurance company.

“We’ve suspended the deal because the acquisition of KDB Life Insurance did not align with the direction of our strategy to bolster our insurance business,” said Hana in a statement. It also cited the insurer’s debt issue.

KDB Life Insurance’s debt ratio as of late June was 2,367.23 percent.

“We have received the intent to give up on the acquisition by Hana Financial Group,” said Korea Development Bank (KDB) in a statement. It vowed to raise the corporate value of the insurer and to come up with future plans considering the market situations.

The majority of the stake in KDB Life Insurance is owned by KDB Consus Value PEF, consisting of KDB, Consus Asset Management and other investors.

KDB acquired Kumho Life Insurance in 2009 as part of a restructuring process for Kumho Group.

Hana Financial Group runs a subsidiary Hana Life, which ranks 17th out of the total 22 life insurance operators. Its acquisition of KDB Life Insurance was expected to push up the ranking to eighth in terms of asset size.

BY JIN MIN-JI [jin.minji@joongang.co.kr]