Saudi Aramco: Saudi Aramco and Petronas eyeing $1.7bn Daewoo E&C stake
Leading international giants in the energy and construction sector such as state-run Saudi Aramco; China State Construction Engineering Corporation (CSCEC) and Malaysian energy giant Petronas are among the potential bidders eyeing a major stake in Daewoo Engineering & Construction (E&C), said a report.
The race for the takeover bid began soon after the Korea Development Bank (KDB) posted a sales notice of its 50.75 per cent stake in Daewoo E&C earlier this month, reported Korea Times.
Industry officials said a foreign company will likely win the bid as the price is expected to hit 2 trillion won ($1.7 billion).
According to the current share price, KDB’s stake will be valued at around 1.5 trillion won, and the state-run bank can ask for premiums for management rights, stated the Korean daily.
All three – Saudi Aramco, CSCEC and Petronas – are said to be keen on grabbing the Daewoo (E&C) stake and are still conducting negotiations, said the report citing sources familiar to the issue. However they have not made any official announcement, it added.
According to sources, both Petronas and China’s CSCEC are lobbying officials of the ruling Democratic Party of Korea. On the other hand, Aramco’s strategy is slighly different – offering a higher bidding price than its competitors instead of lobbying politicians, they added.
KDB has decided to sell the construction company at market price regardless of its book value, if a proper bidder shows up. The bank said it will choose the preferred bidder early next year, according to the Korea Times.
Mirae Asset Daewoo and Bank of America Merrill Lynch are jointly managing the sale, it added.