South Korean credit card company Hyundai Card has embarked on a process to select investment banking houses to underwrite its initial public offering, the company said Oct. 8.
“Hyundai Card handed out requests for proposals (for the IPO underwriting) on Oct. 7 in the evening,” a Hyundai Card spokesperson told The Investor.
The spokesperson added that the company had decided to pursue an IPO as a way to achieve financial stability and enhance transparency.
Details -- such as the time line for the listing, the number of shares to be made available for a public offering and which market it plans to go to -- have yet to be determined, according to the company, reportedly valued at 2.5 trillion won ($2.1 billion).
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Hyundai Motor Group owns a controlling stake in Hyundai Card. Hyundai Motor holds 36.96 percent in the Seoul-based credit card firm. Affiliates Kia Motors and Hyundai Commercial hold 11.48 percent and 24.54 percent, respectively.
Its shareholders also include financial investors such as Hong Kong-based private equity house Affinity Equity Partners, sovereign wealth fund Government of Singapore Investment Corp. and US-based Carlyle Group subsidiary AlpInvest Partners.
The three companies bought a combined 24 percent stake from General Electric Capital in February 2017 when it exited from the company, selling off a 43 percent stake to the new financial investors and Hyundai Commercial for roughly 700 billion won.
Hyundai Card was the fourth-largest credit card company by volume of credit payments in the first half of this year, with 15.6 percent market share. The company is beefing up its domestic presence through a new partnership with Costco, whose warehouse stores and online store in Korea now accept Hyundai only for credit card payments.
By Son Ji-hyoung (email@example.com)