The Korea Deposit Insurance Corp. (KDIC) is revisiting plans to seek an initial public offering (IPO) for Seoul Guarantee Insurance Co. (SGI) after its unsuccessful attempt last year due to sluggish demand.

According to financial authority and KDIC sources on Sunday, KDIC, the largest shareholder of SGI, recently began preparations to apply for a designated auditor to re-initiate the IPO.

For listing, the first step involves a company applying for a designated auditor to the Financial Supervisory Service. Once an auditor is designated, an IPO application can be submitted. For KDIC, it will be this year or next year at the latest.

“We are currently reviewing various possibilities,” a KDIC official said. “The final decision on whether to proceed with the IPO and the future schedule will be made after discussions at our Public Fund Management Committee.”

SGI was established in 1998 through the merger of Korea Fidelity & Surety Co. and Hankuk Fidelity & Surety Co., which were on the brink of bankruptcy during the 1998 foreign exchange crisis. KDIC holds a 93.85 percent stake in the company.

KDIC pursued the listing to recoup approximately 5 trillion won ($3.74 billion) of the 10 trillion won of public funds injected during the crisis.

It was evaluated as the biggest IPO in 2023, but it failed to garner much interest due to tepid market response.

KDIC withdrew its IPO application on October 23 of the same year.

At the time, SGI expressed its intention to reapply for listing, stating that “we plan to continue executing our future growth strategy and enhance profit management as shared during the Investor Relations (IR) process and aim for a reevaluation of our corporate value.”

KDIC President Yoo Jae-hoon also said during a press briefing in December 2023, “As the major shareholder, KDIC receives 200 billion won in dividends every year. We will continue to pursue the recovery of public funds through various means, whether it be an IPO or a sale.”

By Chae Jong-won and Yoon Yeon-hae

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