SEOUL, Sept 12 (Reuters) - An up to $5.3 billion initial public offering of state-owned KDB Financial Group is unlikely before the end of the current government’s term in February next year, South Korea’s Finance Minister Bahk Jae-wan said on Wednesday.
Privatising the holding company and parent of policy bank Korea Development Bank has been a major initiative of South Korean President Lee Myung-bak, whose single term ends in February 2013.
“It will take several months to process the initial public offering of KDB Financial Group,” Bahk told a parliamentary committee.
“Even if [the parliament] agrees to the government guarantee ofdebt, there are time constraints for this administration to continue with the initial public offering,” Bahk said.
The IPO was estimated to be between 2 to 6 trillion won ($1.8-$5.3 billion), as KDB Financial Group Chairman Kang Man-soo previously said between 10 and 30 percent of KDB Financial shares could be listed.
KDB Financial picked Goldman Sachs Group Inc and Samsung Securities Co Ltd as lead managers earlier this year for the prospective listing, and announced plans to conclude listing by October or December.
But the listing process has been stalled as KDB failed to gain parliamentary endorsement that the government will guarantee its external debt, needed to shore up its debt before it seeks exchange approval for listing.