MG Non-Life Insurance (Courtesy of News1)
The sale of South Korean mid-sized insurer MG Non-Life Insurance Co. has been canceled as the insurer in financial distress failed to attract any bidders on Friday.
Korea’s Dayli Partners and New York-based J.C. Flowers & Co., the private equity firms that participated in the preliminary bid in April and conducted due diligence, have dropped out of the deal, investment banking sources said on July 19.
It is the third time the insurer’s sale has been canceled amid tepid investor interest.
Seoul-based JC Partners, which owns a 95.5% stake in MG Non-Life Insurance, withdrew the divestment with no pre-bid participants in January 2023. The PE firm drew one potential bidder last October, which didn’t meet the country’s standard for a takeover bid by the number of bidders.
MG Non-Life Insurance has been put up for sale as the Financial Services Commission (FSC) designated the insurer as a distressed financial institution in April 2022. The deal is led by state-run Korea Deposit Insurance Corp., or KDIC.
The insurer’s K-ICS, or Korean Insurance Capital Standard for capital adequacy, was 52.1% as of the end of the first quarter. The percentage is far below the financial authorities’ recommendation of 150%.
KDIC is considering various plans after the bid failed, such as holding the insurer’s bid again or liquidating the insurance company’s assets.
By Jong-Kwan Park
pjk@hankyung.com
Jihyun Kim edited this article.
