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Korea to clear KorAm stake sale to Carlyle -report

SEOUL: South Korea's Financial Supervisory Commission is expected to approve KorAm Bank's stake sale to Washington, D.C.-based investment firm Carlyle Group, the local Yonhap television reported on Sunday.

But the approval would be given on the condition that the investment firm will not participate in the management of the Korean bank and will not withdraw its investment for three years.

The Yonhap also said Carlyle was expected to ask Germany's Deutsche Bank to help run KorAm Bank in exchange for part of its stake.

Officials at the financial regulator were not available for comment.

On Saturday, a senior official at the KorAm Bank refused to confirm a local media report that KorAm plans to sell 500 billion won of global depositary receipts (GDRs) to Carlyle Group.

But he said KorAm Bank planned to raise 500 billion won through the sale of GDRs by the end of June.

The GDR issue, aimed at raising operating funds, would increase KorAm's shareholders' capital to 1.8 trillion won from the current 1.3 trillion won, the KorAm official said.

In February, KorAm said it had agreed to issue GDRs of that sum to Deutsche Bank.

The German bank said then its interest in that deal was only preliminary and that the bank had dropped out of an investment consortium that was looking to buy the stake.

The Carlyle Group, which leads management buyouts, growth capital financing, strategic minority equity investments, and venture capital financing, has declined to comment on a previous report that said it was in talks to buy an equity stake in KorAm Bank.-Reuters