The NH Financial Group has taken over three affiliates of Woori Financial Group in a package that included Woori Investment and Securities (I&S) Co., Woori Life Insurance Co., and Woori Savings Bank in an open bidding held on Dec. 16 beating its closest rival KB Financial Group, Woori Financial Group said on Dec. 24.
The winning bid for the three affiliates amounted to 1.1 trillion won, with Kium Securities Co. the winner of the bidding for Woori Asset Management Co. with a bid of 70 billion won, Woori Financial said.
NH Financial will strengthen its securities arm by taking over the securities firm with the highest total assets at 29.8 trillion won and can now boast being the top securities firm in Korea with NH Securities’ 6.4 trillion won in assets.
As the priority bidder, NH Financial will be given a chance to inspect Woori Investment and Securities asset for two weeks from Dec. 26 and hold talks with Woori Financial to settle its purchase of Woori Investment and Securities shares before concluding an official contract to take over the company sometime in January.
Chairman Lim Jong-ryong said Woori Financial will be able to make its securities line of business stronger with the acquisition, as Woori Investment and Securities has excellent manpower and services and the group will run NH Securities and Woori I&S separately for a while. The investment banking operations of Woori I&S will be transferred to NH Securities in due course, the chairman added.
He said NH Securities will try to boost its operation to a top level by learning from Woori I&S so that NH Group’s competitive power would equal those of its rivals. He also expected a great turnaround in the operational capacity of NH Financial, too, taking apart its old practices rooted deeply in the worn-out corporate culture left over from the days of the National Agricultural Federation Cooperatives (NACF) that depended on government handouts for operation. NH Financial, as a holding company for NACF’s financial firms, was launched only two years ago.
NH Financial hired a consulting firm to study its reorganization for after the takeover over of Woori I&S. Chairman Lim said he intends to have Woori I&S and NH Securities compete so that NH Securities may strengthen its operation.
Lim promised to take over Woori I&S at his media conference marking his first 100 days in office in early October and he has been at it ever since. He admitted that he was very tense during the entire period to make sure that the plan went smoothly. He had a tough time persuading the top management of NACF, but the most harrowing time was determining the bidding price.
He said he couldn’t sleep the night before the bidding date, Dec. 16, and he approved the bidding price at around 4:10 p.m. on that day just before the bidding scheduled for 5 p.m. He wrote down the figures himself and phoned the clerk on the bidding team to submit the bid. He took action after learning that KB Financial and Pine Street had already submitted their bids to make sure that NH Financial’s bid would not be leaked.
He was told that Pine Street had handed in two bids, but he stood his ground. He did not hand in another bid and stuck with the original bid, to make sure that the rules on bidding should not be violated, as more biddings will be held for the rest of Woori Financial’s affiliates, including Woori Bank and others.
The government and Woori Financial named NH Financial at last as the priority bidder in upholding the bidding regulations.
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