UPDATE 1-MBK Partners in talks for ING's S.Korean unit - source
(Changes sourcing, adds details of negotiation, Tong Yang share movement)
SEOUL Aug 5 (Reuters) - Private equity firm MBK Partners is in exclusive talks to buy a controlling stake in ING Groep's South Korean insurance unit, a source briefed on the matter said on Monday.
ING's South Korean unit attracted a total of four bids in May, including from Tong Yang Life Insurance Co Ltd, Hanwha Life Insurance Co Ltd and Kyobo Life Insurance Co Ltd, sources previously told Reuters.
ING and MBK will start negotiations based on MBK's original bid of about 1.5 to 1.6 trillion won ($1.3-1.4 billion) for a 90 percent stake in the unit, but the final pricing and stake size could change, the first source said.
A spokesman for MBK declined to comment. A representative for ING could not be reached immediately for comment.
Shares in Tong Yang Life plunged 13.7 percent as of 0048 GMT as Yonhap news agency and other South Korean media reported before local trading began on Monday that MBK replaced Tong Yang Life's consortium as the party in exclusive talks for the ING unit.
The sale of its Korea insurance unit would bring ING closer to fulfilling its agreement with European regulators to sell more than 50 percent of its Asian operations by the end of 2013.
($1 = 1123.6250 Korean won) (Reporting by Joyce Lee; Editing by Chris Gallagher)