HSBC denies new deadline for $6.3 billion KEB deal
SEOUL/HONG KONG (Reuters) - HSBC Holdings (HSBA.L) (0005.HK) on Thursday denied a South Korean media report saying it had agreed with U.S. private equity firm Lone Star LS.UL to set a new deadline for a $6.3 billion deal for control of Korea Exchange Bank.
"We have not created a deadline," HSBC spokesman David Hall said.
"Our original position stands, in that either side has the option to walk away, but we made it clear we are interested in continuing this deal."
Online news outlet EDaily, citing financial industry sources, reported that the two sides had agreed to maintain the deal, which was supposed to be wrapped up by July 31, until the end of September.
Lone Star's PR agency in Seoul said there had been no announcement on an extension to the deal, declining to comment further. A KEB spokesman said he was not aware of any developments.
HSBC had agreed to buy 51 percent of KEB (004940.KS), South Korea's No. 6 bank, from Lone Star last September, in a deal that could propel the UK-based bank into the top ranks of Asia's third-largest banking market.
But the July 31 deadline for HSBC's completion of the transaction passed without regulatory clearance because of legal disputes surrounding Lone Star's investment activities in South Korea.
HSBC said on August 4 that it would submit a revised application to the regulatory Financial Services Commission "as soon as practicable."
The deal to buy control of KEB had looked deadlocked until late July, when the Financial Services Commission (FSC) changed tack and said it was starting an approval process -- taken as a sign the government wanted to proceed.
Under the original agreement, HSBC's offer price corresponded to 18,045 won or $19.2 per share, according to HSBC's conversion rate -- a 23 percent-plus premium to KEB's September 3 closing price.
Shares in KEB rose 0.76 percent to 13,300 won at 11:30 p.m. EST, outperforming the broader market's 1.3 percent drop.
(Additional reporting by Rhee So-eui in SEOUL)
(Reporting by Marie-France Han and Tony Munroe; Editing by Jonathan Hopfner)
