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| KB Kookmin Bank headquarters on Yeouido, Seoul / Courtesy of KB Kookmin Bank |
By Anna J. Park
As KB Kookmin Bank continues to form successful strategic partnerships with aspiring tech-based venture companies, market watchers are paying close attention to whether the bank's latest equity investment in T Map Mobility would also yield considerable financial gains.
The bank sold over 14 million shares of KakaoBank in a block deal last Friday, which lowered the traditional lender's stake in the digital bank to 5 percent from 8 percent. On the same day, KB Kookmin Bank signed an acquisition contract with TMap Mobility, vowing to acquire an 8.3 percent stake in the mobility platform business. With a total of 200 billion won ($150 million) injected for the share purchase, KB Kookmin Bank has become the fourth-largest shareholder of TMap Mobility.
As the two events coincided to take place on the same day, market watchers have started to compare the bank's TMap investment to its previous successful investment in KakaoBank, wondering whether the bank would garner impressive financial gains once again from the deal.
KB Kookmin Bank's investment in the internet-only bank has so far yielded a considerable return of about five times its principal investment of 89.8 billion won ($67 million). Since the digital bank's early days to its public offering last year, its solid growth has been supported by KB Kookmin Bank, which has participated in several rounds of KakaoBank's capital increases.
In the case of TMap Mobility, KB Kookmin Bank's acquisition of the 8.3 percent stake for 200 billion won signifies that the mobility company's corporate value stands at around 2.2 trillion won. Given that the mobility platform business plans to grow to a 4.5 trillion won value within the next three years, the bank's stake value could more than double, bringing the bank significant financial gains from the investment.
Bank officials explained that the decision to invest in the mobility company was not based primarily on profit, as the bank acquired the stake as a strategic investor, not as a financial investor.
"The bank's investment decision is based on forming a strategic business partnership with TMap Mobility as a strategic investor. Thus, the bank was not simply aiming for profits from the investment. Yet, of course, the bank assessed that TMap is an excellent company, deserving major investment, considering its great potential for further growth," an official from the bank said.
