Jungheung signs on for Daewoo E&C takeover

A South Korean investor consortium led by Gwangju-based construction conglomerate Jungheung Group has signed a memorandum of understanding to initiate talks surrounding the acquisition of a 50.75 percent stake in Daewoo Engineering & Construction, a filing showed Monday.

Following the nonbinding agreement, the investor group -- comprising Jungheung Group and investment bank Mirae Asset Securities -- will carry out due diligence before signing a binding deal with the company‘s largest shareholder, KDB Investment.

Daewoo E&C noted that details of the deal terms are subject to change as the negotiation goes on, in a filing submitted to the Financial Supervisory Service.

Daewoo E&C is the sixth-largest builder in Korea. The company owns housing franchise Prugio and has a range in its portfolio, including liquefied natural gas regasification plants and storage tanks.

The news comes a month after the Jungheung-led consortium was selected as the preferred bidder for Daewoo E&C takeover in early July.

Jungheung, dedicated to housing construction, civil engineering and real estate development, pledged to strengthen Daewoo E&C’s real estate development business and its international profile with acquisitions for sustainability.

Jungheung Group is the country’s 47th-largest business in Korea. Jungheung Group is also the parent company of Herald Corp., publisher of The Korea Herald.