Hynix Semiconductor News

POSCO and three other South Korean companies submitted their formal bids Tuesday for Daewoo Shipbuilding & Marine Engineering Co., the world's third-largest shipyard, a state-run bank said. Korea Development Bank (KDB) and state-run Korea Asset Management Corp. (KAMCO) are seeking to sell a combined 50.4 percent stake in the shipyard, which they bailed out in 2000 after its parent Daewoo Group collapsed under a mountain of debt. KDB said it will pick a preferred bidder in October after allowing POSCO, Hyundai Heavy Industries Co., GS Group and Hanwha Group to conduct a due diligence on Daewoo Shipbuilding for three weeks starting next week.

Daewoo Shipbuilding & Marine Engineering, one of 's "big three" takeover targets, has been put up for sale. The other two prime takeover targets are Hyundai Engineering & Construction and Hynix Semiconductor, Chosun reported. The Korea Development Bank said it has begun searching for a manager to sell Daewoo Shipbuilding with an aim to select a preferred bidder by August. After Daewoo Group was dismantled in 1999, the shipbuilding business was managed by creditors. The business graduated from its debt workout program in 2001 and has since been managed by the KDB and the Korea Asset Management Corp., which hold a combined stake 50.4 percent. KDB holds 31.3 percent and KAMCO 19.1 percent.

South Korean stocks hit a fresh closing high Thursday as investors picked up shipbuilding and machinery shares, taking a cue from overnight gains in U.S. markets, analysts said. The South Korean won fell against the U.S. dollar. The benchmark Korea Composite Stock Price Index (KOSPI) rose 14.98 points, or 0.94 percent, to 1,615.58. Volume was moderate at 445.7 million shares worth 4.67 trillion won (US$5.03 billion), with winners outpacing losers 544 to 226. Shipbuilders led the gain with top shipyard Hyundai Heavy Industries rising 6.53 percent to 285,500 won. Steel shares gained ground. No. 2 steelmaker Hyundai Steel advanced 2.45 percent to 48,150 won after a local brokerage raised its price estimate for the shares. Tech blue chips traded in negative territory.

Daewoo Shipbuilding and Marine Engineering is expected to go up for sale in the second half of this year, once the firm swings to a solid operating profit in the first half, its main creditor said on Thursday. The long-awaited sale has been widely expected to be one of the country's top acquisition deals in 2007, after the state-run Korea Development Bank (KDB) sold LG Card Co. Ltd. to Shinhan Financial Group for $7.2 billion last year. KDB and state restructuring agency KAMCO jointly own half of the world's No. 2 shipbuilder, valued at 2.5 trillion won ($2.67 billion) at the current market price, after its parent, Daewoo Group, went bankrupt under a mountain of debt in 1999. As for Hynix Semiconductor Inc.

Reuters reported that Korea Development Bank (KDB), a top shareholder in Daewoo Shipbuilding and Marine Engineering Co. Ltd. , will announce in early 2007 a plan to sell the world's No. 2 shipbuilder, the bank's governor said on Monday. State-run KDB and government restructuring agency KAMCO jointly own half of the shipbuilder, one of former units of the bankrupt Daewoo Group, with a market value of $5.7b. The sale is expected to be one of the biggest M&A deals in South Korea, with KDB Governor Kim Chang-lok predicting it would fetch about $6.2 -$7.3b. KDB has outsourced the assessment of the best ownership structure at Daewoo Shipbuilding and the proper time of the sale, and expects to have the outcome in November. Earlier this month, steel maker POSCO Co. Ltd.

Hyundai Heavy Industries, the world's largest shipbuilder, sees a strong earnings recovery after cleaning up the last of its soured investments in sister firms, a company executive said on Thursday. The South Korean company expects to have to write off most of its equity investment in ailing Hynix Semiconductor, formerly Hyundai Electronics, in either 2002 or 2003. "It seems our stake in Hynix has soured," Suh Tae-hwan, a senior vice president in charge of finance affairs, said in an interview with Reuters. Hyundai Heavy built up a 7.01 percent stake in Hynix for 592 billion won. But after the global chip depression that stake is now worth only about 57 billion won ($44.7 million).