South Korea Receives Eight Bids for Troubled Korea Life Insurance

South Korea's government sought a fresh round of bids for the debt-ridden Korea Life Insurance after an initial auction failed to meet its criteria. Analysts say none of the eight bids received meet the necessary requirements, mainly driven by investment and property companies rather than foreign insurers. The government has specified a minimum offer price of Won2,000bn ($1.7bn) for Korea Life, but the new bids still fail to meet this criterion. Critics argue that some of the bidders aim to acquire Korea Life for its valuable property assets, including Korea's tallest skyscraper.

Key Takeaways:

• The South Korean government has received eight bids for the troubled Korea Life Insurance, none of which meet the required criteria.
• Investment and property companies dominate the list of bidders, with only a few foreign insurers participating.
• The minimum offer price for Korea Life is Won2,000bn ($1.7bn), but none of the bidders have met this requirement.
• Axa of France and MetLife of the US dropped out of the bidding process, as did South Korea's LG Insurance due to concerns over large debts.
• Some bidders, such as Hanwha Group, have partnered with Orix of Japan, a major leasing company, but the IFC denied any involvement.
• Bidders have shown interest in acquiring Korea Life's valuable property assets, including its tallest skyscraper.

Statistics:

• The government has set a minimum offer price of Won2,000bn ($1.7bn) for Korea Life Insurance.
• None of the eight bids received meet the minimum offer price requirement.
• South Korea's Korea Life Insurance has debts of $2.4bn.
• The new auction round includes consortia led by AMCO Service, Novecon Financial, and Global Asset Incorporated of the US.

Sources:

• Financial Times Limited 1999.
• World Bank's investment unit, the International Finance Corporation.