Brief Korea: Nexon Sale: Main Bidding on May 15, NXC Stake Up for Sale & No Mandatory Tender and more

In this briefing:

  1. Nexon Sale: Main Bidding on May 15, NXC Stake Up for Sale & No Mandatory Tender
  2. China’s New Semiconductor Thrust – Part 3: Market Size and Impact to Competition
  3. Korea Interest Rates – Next Move Down
  4. Economic Analysis of Mozambique’s LNG Projects: Huge Potential but Financing Risks Remain
  5. Asiana Airlines Stake Sale: Deal Conditions & Potential Buyers

1. Nexon Sale: Main Bidding on May 15, NXC Stake Up for Sale & No Mandatory Tender

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One of Korea’s largest local economic newspapers, The Korea Economic Daily, reports that Nexon’s main bidding will take place on May 15. It also reports that it is the Kim Jung-ju family’s NXC stake to be put up for sale. As for tender, TSE advises in a written opinion that there will be no mandatory tender as a result of NXC stake sale. That is, tender will be optional.

2. China’s New Semiconductor Thrust – Part 3: Market Size and Impact to Competition

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China’s current efforts to gain prominence in the semiconductor market targets memory chips – large commodities.  This three-part series of insights examines how China determined its strategy and explains which companies are the most threatened by it.

This third part of the series  sizes the  market and projects the impact on existing suppliers.

3. Korea Interest Rates – Next Move Down

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We expect interest rates will be declining by the end of the year. BoK Governor Lee Ju-yeol is running out of excuses not to ease monetary policy. Inflation is trending down and is below the central bank’s 2% target. Household borrowing has been slowing for months while the Korean economy is rapidly losing growth momentum. Lower rates will bring little relief however. The outlook is dim. We reiterate our underweight call on Korean equities.

4. Economic Analysis of Mozambique’s LNG Projects: Huge Potential but Financing Risks Remain

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Around 10 years after the first major gas discoveries, Mozambique should see two mega LNG projects sanctioned this year, with an investment of almost four times the country’s GDP. There is huge value creation potential for the people of Mozambique and a good return for the project participants, if the Government can ensure a sound economic environment to operate in. Over the life of projects, there is the potential for around US$100bn in cash flow to the Mozambique people, which would clearly be transformational for Mozambique, with current GDP <$15bn and GDP per capita of <$500. For example, LNG catapulted Qatar to having a leading global GDP per capita. For Mozambique, accessing these future cashflows is reliant on the success of the project financing discussions currently taking place. See A Huge Wave of New LNG Projects Coming in the Next 18 Months: Positive for The E&C Companies

Source: Anadarko

5. Asiana Airlines Stake Sale: Deal Conditions & Potential Buyers

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Kumho Industrial officially confirms Asiana Airlines controlling stake sale in a regulatory filing. KDB is said to have accepted this revised self-rescue measure. Sale process will commence immediately. Several local conglomerate names are being tossed around as a likely buyer. They are SK, CJ, Aekyung and Hanwha.

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