Lone Star Korea's former head Paul Yoo files court appeal
Paul Yoo, former head of Lone Star in Korea, has appealed to Korea’s Supreme Court over his conviction for manipulating the stock price of Korea Exchange Bank (KEB) in 2003, Dow Jones reported.
The appeal comes days after Yoo was sentenced to a three-year jail term by the High Court for spreading rumors about KEB's credit card unit, KEB Credit Services, in 2003 to diminish its share price, making it cheaper for acquisition.
In 2008, a Seoul court found Yoo guilty of manipulating the stock, and sentenced him to five years in jail, but that sentence was later reduced to a two-and-a-half year term. That term was suspended for three years after a court found Yoo guilty of breach of trust but not price manipulation, which has been overturned in this most recent ruling.
In line with Yoo's ruling last week, regulators also found US-based Lone Star guilty of manipulating KEB's stock prices and has ordered the fund to pay KRW25 billion ($21 million) in damages. The private equity firm until midnight on Oct. 13 to file an appeal. Sources told The Korea Herald that an appeal is unlikely given the Korean court's propensity to dismiss the filing.
Meanwhile, the chairman of Hana Financial Group told Reuters that the firm is willing to renegotiate its $4.1 billion offer to purchase the majority stake in KEB held by Lone Star if the US-based buyout firm does not appeal a court ruling. Hana, which offered to acquire the bank last year, may bargain to cut its agreed acquisition price in light of KEB's falling share prices related to the global economic volatility.
Lone Star acquired its majority 51% stake in the bank for $1.3 billion in 2003 and has sought to sell its stake in KEB for five years, but regulators have repeatedly blocked and stalled the process until it could resolve issues surrounding its purchase of the bank. Hana Bank is the leading contender to acquire Lone Star's shares, offering to pay $4.2 billion last year. Regulators have yet to decide on the transaction.
More on North Asia
Latest News
Asian GPs slow implementation of ESG policies - survey
Asia-based private equity firms are assigning more dedicated resources to environment, social, and governance (ESG) programmes, but policy changes have slowed in the past 12 months, in part due to concerns raised internally and by LPs, according to a...
Singapore fintech start-up LXA gets $10m seed round
New Enterprise Associates (NEA) has led a USD 10m seed round for Singapore’s LXA, a financial technology start-up launched by a former Asia senior executive at The Blackstone Group.
India's InCred announces $60m round, claims unicorn status
Indian non-bank lender InCred Financial Services said it has received INR 5bn (USD 60m) at a valuation of at least USD 1bn from unnamed investors including “a global private equity fund.”
Insight leads $50m round for Australia's Roller
Insight Partners has led a USD 50m round for Australia’s Roller, a venue management software provider specializing in family fun parks.