World News | South Korea Objects to World Bank's Order to Pay Lone Star
Get latest articles and stories on World at LatestLY. South Korea says it plans to challenge a World Bank tribunal's order to pay USD 216.5 million plus interest to Texas-based Lone Star Funds following a decade-long dispute over the private equity firm's sale of the Korea Exchange Bank.
Seoul, Aug 31 (AP) South Korea says it plans to challenge a World Bank tribunal's order to pay USD 216.5 million plus interest to Texas-based Lone Star Funds following a decade-long dispute over the private equity firm's sale of the Korea Exchange Bank.
South Korean Justice Minister Han Dong-hoon said on Wednesday that his government finds the ruling unacceptable because there is no fault in the way financial authorities handled the 2012 sale.
He said the ministry is considering seeking an annulment of the order and other steps so that “not a penny of our nation's blood-like taxpayer money is spilt".
Han spoke hours after the Seoul government received the ruling from the World Bank's International Centre for Settlement of Investment Disputes.
Also Read | Taliban Celebrate First Anniversary of Withdrawal of Western Forces From Afghanistan.
The payment ordered by the tribunal represented only 4.6 per cent of USD 4.68 billion Lone Star had demanded, according to Han's ministry, which represents the government in legal cases.
Lone Star initiated the arbitration in 2012, claiming that South Korea's financial regulator unfairly delayed its review process over the sale of KEB and effectively forced the buyout firm to sell the bank at a lower price.
Lone Star acquired a controlling stake in the KEB in 2003, when South Korea was slowly wiggling out of the shock unleashed by the 1997-98 Asian financial crisis.
Lone Star had initially planned to sell its stakes to HSBC, but the British bank dropped its USD 6 billion bid in 2008, after South Korean authorities delayed their approval of the transaction.
They cited legal concerns after a former Lone Star executive was found guilty of manipulating the stock price of a KEB credit-card unit.
Lone Star eventually sold its stake to South Korea's Hana Financial Group for 3.9 trillion won (USD 2.9 billion) in 2012. (AP)
(The above story is verified and authored by Press Trust of India (PTI) staff. PTI, India’s premier news agency, employs more than 400 journalists and 500 stringers to cover almost every district and small town in India.. The views appearing in the above post do not reflect the opinions of LatestLY)