ID :
191743
Wed, 06/29/2011 - 10:49
Auther :
Shortlink :
https://oananews.org//node/191743
The shortlink copeid
CJ sees no problems in funding takeover of Korea Express
(ATTN: ADDS share prices in last para)
SEOUL, June 29 (Yonhap) -- CJ Group, a South Korean food and entertainment conglomerate, said Wednesday that there would be no problems in financing the takeover of a local logistics firm as it has ample cash.
Creditors of Korea Express Co. picked a CJ Group-led consortium on Tuesday as the preferred bidder for South Korea's largest logistics company, a deal which could fetch more than 1.5 trillion won (US$1.4 billion). The consortium is made up of CJ Cheiljedang and CJ GLS, the group's two key affiliates.
CJ Cheiljedang owns shares of Samsung Life Insurance Co., valued at more than 1 trillion won, and lots of real estate up for sale, Lee Kwan-hoon, chief executive officer of CJ Group holding company CJ Corp., told reporters.
"CJ Group will mobilize Samsung Life Insurance Co. shares and other assets to help fund the acquisition. CJ GLS's debt-to-equity ratio would not drastically worsen even if it borrows 500 billion won to fund the acquisition," he said.
CJ Cheiljedang and CJ Corp. own a combined 5.5 percent of Samsung Life Insurance, South Korea's biggest life insurer.
CJ Corp is also considering buying 500 billion won in new shares issued by CJ GLS to fund its purchase of Korea Express, he said.
CJ Group's efforts to purchase Korea Express come as the group is pushing to boost its logistics business by merging with its existing logistics unit CJ GLS.
The group also said it is targeting revenue of 20 trillion won from the group's logistics business by 2020. Korea Express posted sales of 2.1 trillion won last year.
Meanwhile, Korea Express's labor union said its unionized workers will block CJ Group from conducting due diligence on the logistics firm, and launch a strike as the takeover does not generate synergy.
A preliminary agreement will be signed next month, the main creditor Korea Development Bank said earlier.
Shares of CJ Corp. closed at 73,400 won on the Seoul bourse on Wednesday, up 0.55 percent from the previous session, while Korea Express lost 5.86 percent to end at 104,500 won. On Tuesday, shares of Korea Express tumbled 14.9 percent, while CJ Corp plunged around 10 percent.
sam@yna.co.kr
SEOUL, June 29 (Yonhap) -- CJ Group, a South Korean food and entertainment conglomerate, said Wednesday that there would be no problems in financing the takeover of a local logistics firm as it has ample cash.
Creditors of Korea Express Co. picked a CJ Group-led consortium on Tuesday as the preferred bidder for South Korea's largest logistics company, a deal which could fetch more than 1.5 trillion won (US$1.4 billion). The consortium is made up of CJ Cheiljedang and CJ GLS, the group's two key affiliates.
CJ Cheiljedang owns shares of Samsung Life Insurance Co., valued at more than 1 trillion won, and lots of real estate up for sale, Lee Kwan-hoon, chief executive officer of CJ Group holding company CJ Corp., told reporters.
"CJ Group will mobilize Samsung Life Insurance Co. shares and other assets to help fund the acquisition. CJ GLS's debt-to-equity ratio would not drastically worsen even if it borrows 500 billion won to fund the acquisition," he said.
CJ Cheiljedang and CJ Corp. own a combined 5.5 percent of Samsung Life Insurance, South Korea's biggest life insurer.
CJ Corp is also considering buying 500 billion won in new shares issued by CJ GLS to fund its purchase of Korea Express, he said.
CJ Group's efforts to purchase Korea Express come as the group is pushing to boost its logistics business by merging with its existing logistics unit CJ GLS.
The group also said it is targeting revenue of 20 trillion won from the group's logistics business by 2020. Korea Express posted sales of 2.1 trillion won last year.
Meanwhile, Korea Express's labor union said its unionized workers will block CJ Group from conducting due diligence on the logistics firm, and launch a strike as the takeover does not generate synergy.
A preliminary agreement will be signed next month, the main creditor Korea Development Bank said earlier.
Shares of CJ Corp. closed at 73,400 won on the Seoul bourse on Wednesday, up 0.55 percent from the previous session, while Korea Express lost 5.86 percent to end at 104,500 won. On Tuesday, shares of Korea Express tumbled 14.9 percent, while CJ Corp plunged around 10 percent.
sam@yna.co.kr
