SEOUL– Jungheung Construction, a midsized local builder, has been named the preferred bidder to acquire a controlling stake in Daewoo Engineering & Construction Co., an investment fund under the state-run Korea Development Bank (KDB) said Monday.
The 50.75 percent stake up for sale in Daewoo E&C is reportedly valued at around 2 trillion won (US$1.7 billion).
KDB Investment CEO Lee Dai-hyun said in a virtual news conference that the investment fund “made the decision by taking into account swiftness and certainty of the deal and growth and a stable management Daewoo Engineering.”
Last month, Jungheung Construction reportedly offered 2.3 trillion won to buy the controlling stake in Daewoo E&C while a consortium led by DS Networks, a property developer, submitted a 1.8 trillion won bid.
But Jungheung Construction called for a revision of its bid, and KDB Investment informed DS Networks consortium of Jungheung Construction’s request and asked DS Networks consortium to submit a revised bid.
In 2018, Hoban Construction Co. was selected as a preferred bidder to buy the stake in Daewoo E&C, but it later dropped its bid to buy the bigger rival, citing hidden losses in Daewoo E&C’s overseas businesses.
In April, Daewoo E&C reported a first-quarter net profit of 147.9 billion won, up 138.9 percent from a year earlier. The builder’s operating profit nearly doubled to 229.4 billion won in the January-March period.
Source: Yonhap News Agency