Affinity, MBK submit final bids for S.Korea's largest car rental firm

Six investors including SK Networks Co. and private equity firm MBK Partiners have submitted their final bids to buy South Korea's biggest car rental firm KT Rental, in what could be the largest merger and acquisition deal in the first half, industry sources said Wednesday.

KT Corp, the parent of KT Rental, put their entire stake in the car-rental service firm up for sale in June in a deal expected to fetch up to 800 billion won (US$737 million).

The sources said a consortium comprising of two private equity firms -- MBK Partners and IMM, retail giant Lotte Group, and the country's top tiremaker Hankook Tire Co. were also among the final bidders. Affinity Equity Partners, an Asian private equity fund, also joined the race for the acquisition, they said.

In November, KT, South Korea's No.2 mobile operator, shortlisted nine investors for the final bidding.

KT will select the preferred bidder next month and complete the deal before June.

KT, which owns 58 percent of KT Rental, has put the car rental business unit on the selling block as part of its broader efforts to improve its financial health. Kyobo Life Insurance Co., South Korea's No. 2 life insurer, and five other financial investors hold the remaining 42 percent.

KT Rental, the industry leader with a 26 percent market share, is forecast to have posted sales of over 1 trillion won last year following 885 billion won in sales the previous year.