Forecast: Woori Financial Group Sells 153 Billion KRW Worth of Shares in Block Deal

[Asia Economy Reporter Song Seung-seop] The Korea Deposit Insurance Corporation, the largest shareholder of Woori Financial Group, is disposing of stocks worth 153 billion KRW through an after-hours block trade. The government plans to pursue a phased sale and the sale of remaining shares with a management premium, aiming for the complete privatization of Woori Financial Group by 2022.

According to industry sources on the 8th, Mirae Asset Securities, Samsung Securities, and JP Morgan, as block trade underwriters, are conducting demand forecasting for domestic and foreign institutional investors after market close for the disposal. The target is 14,445,354 common shares of Woori Financial Group held by KDIC.

KDIC currently holds a 17.25% stake (124.6 million shares) in Woori Financial Group. The selling price per share is set between 10,335 KRW and 10,600 KRW, applying a discount rate of 0 to 2.5% to the closing price of 10,600 KRW on the day, making the total transaction size reach 153 billion KRW.

This transaction is part of the "Woori Financial Group Remaining Shares Sale Roadmap" announced by the Financial Services Commission in 2019. The FSC and KDIC pledged in June 2019 to sell all remaining shares within three years in several rounds, with a maximum of 10% at a time.

Accordingly, they contacted overseas investors at the end of 2019 to gauge acquisition interest but did not achieve significant results. The Woori Financial Group stock price did not reach KDIC’s principal recovery price of 12,000 KRW, so the planned share sale could not proceed as scheduled.

However, earlier this year, as major financial stocks rose amid an interest rate hike trend, Woori Financial Group’s stock price also increased. This was driven by expectations that net interest margin (NIM) would rise and profitability could improve. On the 7th, Woori Financial Group’s stock price rose intraday to 10,850 KRW, setting a 52-week high.

The block trade is scheduled to take place before the market opens on the 9th. After the transaction, the remaining shares held by KDIC will be subject to a three-month lock-up period, and the remaining shares can be sold starting in July.

This content was produced with the assistance of AI translation services.