(Adds Tong Yang and MBK's bids, seller's valuation of unit,
Tong Yang's ranking)
By Joyce Lee, Denny Thomas and Stephen Aldred
SEOUL/HONG KONG May 24 Dutch bank ING
has attracted two more bidders for its South Korean insurance
business, said a source with direct knowledge of the matter,
taking the total number to three and raising the chances of a
successful deal after an earlier sale fell through.
Tong Yang Life Insurance Co Ltd and private
equity firm MBK Partners made separate bids for a controlling
stake in ING's South Korean insurance unit, the source said late
They will compete with another bid made on Friday by South
Korea's third-largest insurer Kyobo Life Insurance Co Ltd
, and collectively breathe new life into a delayed
deal previously valued at roughly $2 billion.
The deal is set to get more crowded with the country's
second-largest insurer Hanwha Life Insurance Co Ltd
expected to submit its own bid according to a second source with
direct knowledge of the matter.
The sources declined to be identified as the bidding process
The sale is set to be one of the largest M&A deals in Asia's
fourth-largest economy this year, although the final value
depends on the size of the stake that ING sells.
ING is only required to sell more than 50 percent in the
unit by 2013 and divest the remaining interest by the end of
2016, but it wants to sell as much as possible, sources said.
The sale of a stake in its Korea insurance unit will bring
ING Groep NV closer to fulfilling its agreement with European
regulators to sell more than 50 percent of its Asian operations
by the end of 2013.
KB Financial Group Inc had been lined up to buy
the unit for roughly $2.1 billion last year, but dropped its bid
in December after months of negotiations.
This time around, ING has asked bidders to attach bank
letters of credit to their bids as a way to guarantee financial
backing, a buy-side source and a local bank executive in charge
of corporate financing previously told Reuters.
ING Life Insurance Korea Ltd is the country's fifth-largest
life insurer with 22.7 trillion won ($20.11 billion) in assets
as of end-2012. Although ING has valued it at between 3.2-3.6
trillion won, bidders have likely submitted a much lower price,
knowing that it needs to do a deal, the first source said.
Tong Yang Life, the country's eighth-largest life insurer,
is backed by Seoul-based private equity Vogo Fund, while Kyobo's
investors include Ontario Teachers' Pension Plan, Singapore
sovereign fund GIC and private equity firm Affinity
An ING Groep spokeswoman was unavailable for comment.
Officials at Hanwha Life, Tong Yang Life and MBK Partners
declined comment or could not be reached.
Goldman Sachs and JP Morgan are advising ING
on the sale. ($1 = 1128.5750 Korean won)
(Editing by David Chance and Sophie Walker)