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Kyobo Life resumes IPO push amid protracted dispute with investors

The insurer faces hurdles as it locks horns with FIs over their long-delayed exit from the unlisted firm

By Nov 18, 2021 (Gmt+09:00)

Kyobo Life Insurance headquarters in Seoul
Kyobo Life Insurance headquarters in Seoul

Kyobo Life Insurance Co., South Korea’s third-largest life insurer, is resuming its push for an initial public offering amid a protracted legal dispute with its major financial investors over their exercise of put option rights.

The company said on Wednesday it will file a review request for its IPO plan with the Korea Exchange by the end of December, with an aim to go public on the main bourse in the first half of next year.

The number of its shares on offer and other detailed procedures will be determined at a later time in consideration of market conditions, it said.

Kyobo Life’s renewed IPO push, which comes after a few aborted attempts since 1989, will offer its major financial investors an opportunity to exit their investments, but faces several hurdles as both sides are entangled in a complicated legal dispute, dimming the chance for a successful share sale to the public.

The company, among other things, must obtain approval from its financial investors if it is going to float its shares below the FIs’ purchase price of 245,000 won a share.

Kyobo Life and a group of financial investors, including Hong Kong-based Affinity Equity Partners, have been locking horns in a legal battle since 2019, filing complaints against each other with domestic and international courts.

Back in September 2012, a consortium led by Affinity bought shares in Kyobo Life for 245,000 won apiece for a combined 24% stake worth 1.2 trillion won ($1 billion) on condition that the company go public by September 2015.

If the IPO didn’t take place by then, they were supposed to sell the shares back to the insurer’s Chairman and top shareholder Shin Chang-jae, according to the consortium that included Singapore's sovereign wealth fund GIC, Baring Private Equity and IMM Private Equity.

Kyobo Life Insurance headquarters in Seoul
Kyobo Life Insurance headquarters in Seoul

Kyobo’s IPO bid has been shelved several times as the overall insurance industry faced worsening profitability amid ultra-low interest rates.

With no progress in Kyobo’s IPO efforts, the four investors in late 2018 called on Shin to buy back their shares at 409,000 won a share – a price set by accountants hired by the investors.

However, Shin disavowed his responsibility to buy back those shares, saying he would continue to do his best to take the company public.

The consortium took the case to the International Chamber of Commerce (ICC), but the arbitration body invalidated their request in September this year, taking issue with the striking price.

Nevertheless, the ICC ruled the FIs’ right to exercise their put options is valid.


The investors then filed an injunction with a local court, urging Shin to quickly reassess their put option prices and implement the share buyback. In response, the Kyobo chairman filed a suit against the consortium-hired accountants over their appraisal of the repurchase price.

On Wednesday, Affinity questioned Kyobo’s renewed IPO push, saying it is doubtful whether Shin has the willingness to accept their put option rights.

The private equity firm said its consortium is open to talks with Shin over an appropriate price at which they will exercise their put option rights.

Kyobo Life Chairman Shin Chang-jae
Kyobo Life Chairman Shin Chang-jae

Other investors in Kyobo include Canada's Ontario Teacher's Pension Plan (OTPP) with a 7.62% stake and Affirma Capital with a 5.33% stake. Affirma brought forward a similar request for arbitration to the ICC in 2019, while OTPP has not taken specific action for the recovery of its investment.

Shin, as Kyobo Life’s largest shareholder, holds a 33.78% stake and controls 36.91% of the insurer when combined with the stakes held by his family members and related parties.

If the insurer lists its shares on the Kospi market this time, market watchers say its enterprise value will come in a range of 3 trillion won to 5 trillion won.

Kyobo is Korea’s third-largest life insurer after market leader Samsung Life Insurance Co. and No. 2 player Hanwha Life Insurance Co.

Write to Ho-Gi Lee, So-Ram Jung and Chae-Yeon Kim at

In-Soo Nam edited this article.

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