Daewoo Shipbuilding falls to lowest in over two years
Daewoo Shipbuilding & Marine Engineering Co. slipped to the lowest in more than two years in Seoul trading on concern bidders vying for majority stake will pay less than expected for a stake amid a global credit crisis.
Daewoo Shipbuilding, the world’s third-largest shipyard, fell 7.1 per cent to close at 26,150 won, the lowest since June 2006.
National Pension Service, the country’s biggest investor, said it postponed a meeting to decide on bidding for the 50.4 per cent Daewoo Shipbuilding stake on sale. Analysts had predicted the stake may sell for 7 trillion won ($5.7 billion).
“The market’s previous expectation for heated competition and high price for Daewoo Shipbuilding has been waning and the fund’s comment on Thursday is reaffirming the fact,” said Kwak Tai Ho, who helps manage about $1.6 billion of equity assets at Kyobo AXA Investment Managers Co. in Seoul as an analyst.
“M&A projects such as the Daewoo Shipbuilding deal are losing charm with this global credit crunch.”
The global markets rout this year has opened more investment opportunities for National Pension Service, Kim Hee Seok, a division head for the fund’s alternative investment team said on Thursday over the phone.
Kim rejected a Yonhap news report that the fund had already decided against a bid for the shipbuilder.
The fund said on August 19 it may spend as much as 1.5 trillion won to make a joint bid.
It has been in talks with Posco, GS Group and Hanwha Group to choose a partner in what may be the biggest acquisition in the shipbuilding industry.
State-owned Korea Development Bank and Korea Asset Management Corp. are selling their 50.4 per cent stake in Daewoo Shipbuilding. A preferred bidder will be selected this month. Concerns over a slowing global economy and falling freight rates also hurt other shipbuilding stocks on Thursday, Kyobo AXA’s Kwak said.
Hyundai Heavy Industries Co., the world’s biggest shipyard, fell 3.1 per cent to 253,000 won. Samsung Heavy Industries Co., the world’s second-biggest, shed 2.2 per cent to 29,450 won. Hyundai Mipo Dockyard Co., a unit of Hyundai Heavy, dropped 3.3 per cent to 159,500 won.
Daewoo Shipbuilding, the world’s third-largest shipyard, fell 7.1 per cent to close at 26,150 won, the lowest since June 2006.
National Pension Service, the country’s biggest investor, said it postponed a meeting to decide on bidding for the 50.4 per cent Daewoo Shipbuilding stake on sale. Analysts had predicted the stake may sell for 7 trillion won ($5.7 billion).
“The market’s previous expectation for heated competition and high price for Daewoo Shipbuilding has been waning and the fund’s comment on Thursday is reaffirming the fact,” said Kwak Tai Ho, who helps manage about $1.6 billion of equity assets at Kyobo AXA Investment Managers Co. in Seoul as an analyst.
“M&A projects such as the Daewoo Shipbuilding deal are losing charm with this global credit crunch.”
The global markets rout this year has opened more investment opportunities for National Pension Service, Kim Hee Seok, a division head for the fund’s alternative investment team said on Thursday over the phone.
Kim rejected a Yonhap news report that the fund had already decided against a bid for the shipbuilder.
The fund said on August 19 it may spend as much as 1.5 trillion won to make a joint bid.
It has been in talks with Posco, GS Group and Hanwha Group to choose a partner in what may be the biggest acquisition in the shipbuilding industry.
State-owned Korea Development Bank and Korea Asset Management Corp. are selling their 50.4 per cent stake in Daewoo Shipbuilding. A preferred bidder will be selected this month. Concerns over a slowing global economy and falling freight rates also hurt other shipbuilding stocks on Thursday, Kyobo AXA’s Kwak said.
Hyundai Heavy Industries Co., the world’s biggest shipyard, fell 3.1 per cent to 253,000 won. Samsung Heavy Industries Co., the world’s second-biggest, shed 2.2 per cent to 29,450 won. Hyundai Mipo Dockyard Co., a unit of Hyundai Heavy, dropped 3.3 per cent to 159,500 won.