Posted January. 10, 2005 22:40,
Korea Fist Bank (KFB) was sold to Standard Chartered Bank (SCB), headquartered in London, for 3.4 trillion won.
With SCB joining the market, following the launch of Citibank Korea last year, the domestic financial market will become the arena of competition among the global financial institutions.
We will acquire 48.56 percent of KFB shares owned by Newbridge Capital and 51.44 percent of shares owned by the Korean government (48.49 percent from the Korean Deposit Insurance Corporation and 2.95 percent from the Ministry of Finance and Economy) at 16,511 won per share, SCB announced on Monday afternoon at the SCB Korea branch in Seoul.
As a result, the management rights of KFB will be handed over to SCB in five years since the rights went to Newbridge Capital, the U.S. private equity fund, in 1999 right after the financial crisis.
SCB is going to pay a total price of 3.4 trillion won, or 16,511 won per share. Along with its own capital, the bank plans to raise additional money through issuing new shares worth about $2 billion.
Newbridge Capital took over KFB at 500 billion won in 1998 and sold it at 1.7 trillion, earning a margin of 1.2 trillion won.
Some criticize that a huge amount of taxpayers money was lost due to the sale of KFB at a giveaway price in 1998.