South Korean second-largest retailer, the Lotte Group, has emerged as an unexpected bidder for the controlling stake in commodities trader and shipper, Daewoo International, according to an unidentified source within the company.
Yesterday, the country’s largest steelmaker, POSCO, indicated that it would be bidding for the stake of between 50 per cent plus one share and 68 per cent, which has been put up for sale by nine Daewoo shareholders.
Meanwhile analysts have played down Lotte’s chance of succeeding in buying the stake, pointing to various synergies in the POSCO bid and the fact that POSCO has more cash to bid for the Daewoo stake.
POSCO is looking at Daewoo’s energy and resource development business which it can tap into to secure supplies for its steel business.
It is believed that a number of other bidders handed in letters on intent by Wednesday’s deadline, although other than POSCO and Lotte none have been identified. It is believed that a consortium put together by a former Daewoo executive was also looking to put together a bid.
The sale of the Daewoo stake is being handled by the state-run Korea Asset Management Corp.
Des Nogalski
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