BKL Advised KB Kookmin Bank on its Acquisition of Prasac Microfinance Institution, the largest microfinance institution in Cambodia
On April 10, 2020, KB Kookmin Bank (“KB”) successfully closed a transaction to acquire a 70% equity stake in Prasac Microfinance Institution Ltd. (“Prasac”), which is the largest microfinance deposit taking institution (MDI) in Cambodia, at the price of approximately US$ 603.4 million. As a result of this acquisition, KB has become the largest shareholder of Prasac. KB has maintained a strategic relationship with Prasac since 2016, and in May 2019, it obtained the requisite approval for the transaction from the National Bank of Cambodia and negotiated the terms of acquisition as a qualified purchaser.
BKL has provided comprehensive advice for KB from the early discussion stage to the successful closing of the transaction. Prior to the consummation of the transaction, BKL managed local due diligence on Prasac by reviewing and providing advice on legal due diligence report prepared by the local law firm in Cambodia, drafted and negotiated all of the relevant transaction documents, including the share purchase agreement, the shareholders’ agreement and other ancillary agreements, and analyzed local legal and regulatory issues including, but not limited to, Cambodian labor and corporate law issues. Today, BKL continues its role as the legal counsel to advise KB on matters related to the post-merger integration process.
This transaction marked an important turning point for KB’s retail network extension in Asia, and has given KB an opportunity to expand its business in a meaningful manner in Cambodia. For Prasac, KB’s sophisticated products, modern technology, experience and know-how, as well as additional capital are anticipated to bring positive changes that eventually will contribute to the overall financial stability and economic growth of Cambodia.
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