The Korean merger and acquisition market will be red-hot in February as a number of big takeover deals worth a combined 4 trillion won ($3.42 billion) will be conducted.

According to sources from the investment banking industry on January 26, the race to take over Korea’s leading industrial gas supplier Daesung Industrial Gases Co. will begin in earnest next month. The focus is now on who would offer more than 1.5 trillion won ($1.28 billion) that the sellers Daesung Group Partners Co. and Goldman Sachs expect in the main bid scheduled in early next month. Market analysts predict it will be a two-way race between the nation’s largest private equity operator MBK Partners and U.S.-based private equity firm TPG Capital LP. TPG plans to raise funds from KB Kookmin Bank and Hana Financial Investment Co. and MBK Partners will be financed by NH Investment & Securities Co., Samsung Securities Co. and Woori Bank.

Sales of eBest Investment Securities Co. will also speed up with its largest shareholder LS Networks Corp. holding a 85 percent stake embarking on the sales process. LS Networks and its sale adviser Citi Group Global Market Securities have been trying to sign non-disclosure agreements (NDA) with 10 or more potential buyers from home and abroad. They plan to hold a preliminary bid in early February and conduct a main auction to select a preferred bidder by March. Market watchers predict that the deal would be worth 400 billion to 500 billion won.

The race to take over a 84.56 percent stake in Hyundai Cement Co. owned by its creditors including Korea Development Bank is also expected to be heated. Its shortlisted candidates including Halla Cement Corp., SSangyong Cement Industrial Co., IMM Private Equity Inc. and Hyundai Sungwoo Holdings would participate in the main bid slated for February 14. The sale could fetch as much as 500 billion won to 600 billion won, according to market experts.

A main action to buy Kyungnam Energy Co. is also scheduled around late February. Shortlisted candidates including Macquarie Korea Opportunities Management Ltd., EQ Partners Co. and Choongnam City Gas Co. are reportedly conducting their due diligence. The sellers including its largest shareholder Sangwon Comtru Co. expect around 600 billion won while the potential buyers offered 500 billion won, according to sources.

By Kang Doo-soon and Chun Gyung-woon

[ⓒ Pulse by Maeil Business News Korea & mk.co.kr, All rights reserved]