HSBC extends KEB buyout deadline

  • South Korea
  • 05/05/2008
  • BBC News

HSBC is extending the 30 April deadline on its $6.3bn (£3.18bn) offer to buy a 51% controlling stake in Korea Exchange Bank from a Texas-based company.

In September it agreed the deal with US private equity firm Lone Star, but it was dependent on legal and government conditions being met by late April.

The deadline has now been extended to 31 July as the deal still needs the South Korean regulators’ approval.

Regulators say questions remain over Lone Star’s 2002 purchase of KEB.

South Korea’s Financial Services Commission (FSC) chairman Jun Kwang-woo said there were persistent legal uncertainties regarding that Lone Star acquisition six years ago.

If the proposed HSBC purchase goes ahead it will make the British bank the third foreign bank to take control of a South Korean bank, following Citigroup and Standard Chartered.

The purchase price has not changed since September, and HSBC says it does not intend to make a tender offer to KEB’s other shareholders.

In March, South Korea’s Fair Trade Commission gave approval for the acquisition.