KDB Life Insurance Raising Expectations for Sale… The background of the ‘show signs’

[이데일리 김근우 기자] While the sale of KDB Life Insurance is in progress, a number of potential buyers have appeared and are showing ‘signs of success’. Unexpected interest in the sale of KDB Life seems to have been due to the background of ‘reduction without compensation’ to reduce the burden on the acquirer by reducing the size and ‘license’ to open the way to enter the life insurance business.

View of KBD Life Tower (Photo = KDB Life Insurance)

According to the investment banking (IB) industry on the 2nd, Fountainhead PE (Private Equity) and WWG Asset Management have so far expressed their intention to acquire KDB Life Insurance. In addition, although not yet known, there are more original buyers who are willing to take over, and it is understood that a meeting with the seller in the future is also scheduled.

Fountainhead PE is a new private equity fund (PEF) management company established earlier this year by CEO Shin Seung-hyun, who previously served as the CEO of MG Insurance. CEO Shin is a person who founded the Daily Financial Group with Park Sang-young, CEO of The Seed Partners, and was in charge of the acquisition promotion team when JC Partners, the current major shareholder of MG Insurance, set out to acquire KDB Life Insurance in 2020, and was appointed as the CEO of MG Insurance. is known to have a high level of understanding.

WWG Asset Management, which was established together with KIC (Korea Investment Corporation) graduates, also threw a vote. WWG Asset Management is led by Park Je-yong, who served as KIC CIO (Chief Investment Officer), and is highly interested in acquiring an insurance company, competing until the last minute during the 2020 acquisition of Hyosung Capital and being selected as the ‘second-priority negotiator’. it is transmitted

It is evaluated that ‘reducing the size’ played a part in the acquisition of KDB Life Insurance, a sale that did not have high expectations, as it unexpectedly received a lot of attention, as four attempts to sell it failed in nearly 10 years. KDB Life Insurance plans to implement a free reduction next month by voting on a free reduction plan at the general shareholders’ meeting on the 8th. The capital reduction ratio will be reduced to 75%, and the capital will be reduced from 474 billion won to 118.6 billion won.

Regarding KDB Life’s free reduction, an IB industry official said, “In order for the acquirer to secure a sufficient share in the future, it will be easier for the existing shareholder to reduce the stake.” It may be a condition to participate in the capital increase,” he explained.

In addition, ‘license’ is cited as another reason why KDB Life Insurance is receiving attention. Rather than competitiveness or operational efficiency in the industry that can be obtained by acquiring KDB Life Insurance, it is possible to secure a ‘passage to advance into the industry’ in a place where the life insurance business is not operated.

This official said, “As a life insurance company, in order to have operational efficiency, I think it is meaningful to have 50 to 60 trillion won in operating assets, which is the 5th to 6th place in the industry.” It’s not a bad choice as a license play,” he explained.

There is also a prospect that a buyer who can conclude a deal will eventually be a place where sufficient capital can be invested. The official said, “Life insurance companies that sell long-term products such as whole life insurance and annuity insurance must eventually be supported by a certain amount of capital.” That will be the key to closing the deal,” he added.

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2023-06-02 11:33:23