Planned KorAm-Hana merger abortive

KorAm Bank and Hana Bank aborted a merger attempt due to opposition from the Carlyle Group, a large shareholder of KorAm Bank.

Shin Dong-Hyuk, president of KorAm Bank, said in a news conference Tuesday that Carlyle was opposed to the merger because it would not create much of a synergy effect or maximize the value of the bank's shares. Shin said that because Carlyle, the holder of a 40.1 percent stake in the bank, was negative on the deal, it would be difficult to push ahead with the project.

Shin expected that Carlyle would soon make an official announcement of its opposition to the agreement. In recognition of the difficulty of finding a niche market in the narrow Korean financial world, the bank will look for other means to expand its size, he said.

According to Shin, Carlyle promised to back financial restructuring when it agreed to invest in KorAm Bank.

"Carlyle is negative on the merger with Hana Bank but is not opposed to the idea of a marriage with another bank," he added.