Daishin to sell its headquarters at $493 mn to NH-Amundi

The brokerage firm will accelerate its corporate finance and investment banking services with increased capital

Daishin Securities headquarters in Euljiro, Seoul (Courtesy of Yonhap News)

See-Eun Lee 1

2024-03-19 15:20:52 see@hankyung.com

Real estate

South Korea’s Daishin Securities Co. is set to sell its headquarters office to NH-Amundi Asset Management Co. for 660 billion won ($492.6 million) to spur the brokerage house’s investment banking and corporate finance businesses, sources familiar with the matter said on Monday.

If the deal is clinched, Daishin’s capital on an unconsolidated basis will rise to more than 3 trillion won from 2.9 trillion won as of the end of 2023, meeting one of the qualifications to become a “comprehensive financial investment business entity” under local law.

If a financial firm becomes this type of entity, the company can raise its line of credit from 100% of its capital to 200%, doubling its lending capacity for corporate clients. It can also actively offer corporate finance and investment banking services, such as a prime brokerage business for hedge fund managers.

Daishin will start an application process as early as next month to become a comprehensive financial investment business entity, sources said.

There are nine local brokerages entitled as such entities – Shinhan Securities Co., KB Securities Co., Korea Investment & Securities Co., NH Investment & Securities Co., Samsung Securities Co., Mirae Asset Securities Co., Meritz Securities Co., Hana Securities Co. and Kiwoom Securities Corp.

The office dubbed Daishin 343, located in the Euljiro financial district in Seoul, has 26 floors above the ground and seven underground with a floor area reaching 53,369 square meters. The sale price will be around 12.4 million won per square meter, sources added.

The brokerage firm has pushed the divestment of the property since last year. It tapped Korea’s largest real estate firm IGIS Asset Management Co. as the preferred bidder last August, but the deal fell through due to a valuation gap.

Daishin resumed the sale process in January of this year with NH-Amundi and Mastern Investment Management Co. as bidders. Mastern dropped the deal given differing views on the sale price.

Write to See-Eun Lee at see@hankyung.com

Jihyun Kim edited this article.