General Electric announced Feb. 1 (local time) that it has signed a deal to sell its entire 43 percent stake in South Korean credit card firm Hyundai Card as part of the US industrial giant’s restructuring strategy to exit financial services sector globally.
General Electric will divest its 69 million shares of Hyundai Card to four firms, including Hyundai Commercial, Hong Kong-based private equity firm Affinity Equity Partners, Singapore sovereign wealth fund GIC and Amsterdam-based private equity firm AlpInvest. The entire deal value, however, has not been disclosed.
In a regulatory filing, Hyundai Commercial, the auto financing arm of Hyundai Motor Group, said it will buy 30.5 million Hyundai Card shares from GE, or approximately 19 percent stake, for 298 billion won (US$258.59 million) for “management purposes.” This means the rest of 24 percent stake will be split between the three firms.
Once the deal is completed, Hyundai Commercial’s stake in Hyundai Card will increase to 24.54 percent, becoming the second largest shareholder after Hyundai Motor, which owns 37 percent. Kia Motors own approximately 11.5 percent of Hyundai Card.
The agreement puts an end to the 12-year-old business partnership between South Korea’s largest automaker Hyundai Motor
Group and GE -- which was established in 2004 by the formation of two joint ventures, Hyundai Card and Hyundai Capital.
Last year, GE completed selling its entire 43 percent stake in Hyundai Capital, the auto conglomerate’s financial service arm, to Hyundai Motor Group.
The sale is in line with GE’s restructuring efforts to focus on large industrial products by slimming down its consumer finance sector globally.
By Ahn Sung-mi (email@example.com