Corporate restructuring
Kyobo Life seeks to transition into financial holding company
The insurance behemoth has informed its financial investors of a plan to pass a special resolution at the next board meeting
By Dec 07, 2022 (Gmt+09:00)
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![Kyobo Life Insurance headquarters](https://www.kedglobal.com/data/ked/image/2022/12/07/ked202212070038.700x.0.jpg)
South Korean life insurance behemoth Kyobo Life Insurance Co. is seeking to transition into a financial holding company to expand its business foothold.
Industry insiders familiar with the development told The Korea Economic Daily that Kyobo Life informed its financial investors (FIs) of a plan to pass a resolution on the transition at the next board of directors meeting scheduled for February 2023.
Under the plan, Kyobo Life will be split into a holding company and other businesses through an equity spinoff.
![Kyobo Life Insurance Chairman Shin Chang-jae](https://www.kedglobal.com/data/ked/image/2022/12/07/ked202212070034.142x.0.jpg)
Affinity Equity Partners has a 9.05% stake in Kyobo Life, followed by Affirma with a 5.33% stake and IMM Private Equity Inc. with a 5.23% stake.
To complete the lineup of a financial holding company, Kyobo will seek to acquire additional insurance companies.
As such, the company decided to participate as a key investor in a fund organized by The Seed Partners, which is negotiating to acquire MG Non-Life Insurance Co.
The word on the street is that Kyobo will foot two-thirds of the acquisition cost estimated to be between 50 billion ($37.8 million) and 130 billion won.
Whether the plan is likely to materialize is another story.
Both the equity spinoff and transition into a holding company require special resolutions to be passed at a meeting of shareholders.
For a special resolution to be approved, more than a third of the total shareholders must attend the meeting and more than two-thirds of the attendees must agree on passing the resolution.
But industry insiders say Kyobo’s financial investors are not favorable to the company's top management.
![Logo of Kyobo Life Insurance](https://www.kedglobal.com/data/ked/image/2022/12/07/ked202212070035.510x.0.jpg)
IPO AMBITIONS
Back in July, the Korea Exchange did not approve of Kyobo becoming a public company.
The securities exchange operator cited the ongoing put option lawsuit between Kyobo and a consortium led by Affinity Equity Partners and participated in by IMM Investment, Baring Private Equity Asia and GIC.
The fact that its net profit plunged by 27% on-year in this year's third quarter also worked against its listing screening.
Kyobo Life hopes to increase its corporate value through the transition into a holding company and seek a listing again in the future.
Write to Dong-Hun Lee and Jin-Hyoung Cho at leedh@hankyung.com
Jee Abbey Lee edited this article.
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