이 기사는 2021년 07월 01일 08:11 thebell 에 표출된 기사입니다.

Daewoo E&C is likely to finally find a buyer twelve years after the then-ailing construction firm was acquired by the state-controlled Korea Development Bank (KDB), with attention being paid to whether the company will continue to operate independently under the new ownership.

Jungheung, a mid-sized construction firm, and a consortium led by real estate developer DS Networks submitted binding bids for Daewoo E&C last week. Many believe Daewoo E&C to find a buyer this time because both bidders have strong interest in acquiring the company and KDB is also determined to exit its over decade-long investment, as signaled by its request for bidders to pay a 50 billion won ($44.3 million) deposit upfront to guarantee the purchase.

Daewoo E&C is one of the country’s biggest construction firms, while the two bidders are smaller in size. Mid-sized builder Hoban Construction – which was named as the preferred buyer for Daewoo E&C in 2018 but ultimately withdrew from the deal – had reportedly intended to let the firm operate independently to ease employee anxiety and ensure successful post-acquisition integration.

Whoever wins the race is likely to make the same decision. While Daewoo E&C is run by professional managers, both Jungheung and DS Networks are family-run businesses, with the owner’s family members acting as key decision makers. Jungheung’s key affiliates are owned by founder and chairman Jung Chan-sun and his son. DS Networks is also wholly owned by chairman Chung Jae-hwan and his family members.

It will be difficult to manage Daewoo E&C in a way they have done so far given the company’s larger size. They will also be unfamiliar with overseas plant construction projects, which account for a large part of Daewoo E&C’s revenue, as both firms have only focused on domestic operations.

With all of this in mind, an immediate organizational revamp is unlikely under the new ownership, especially amid growing negative sentiment among Daewoo E&C employees who are raising doubts about the management ability of both bidders. But key positions in the company, such as financial head and human resources head, may be filled by personnel from the acquiring firm.

Jungheung, if it becomes the new owner, is unlikely to combine Daewoo E&C’s apartment brand Prugio with its Jungheung S-Class, which has relatively lower brand awareness.

“Apartment brand awareness plays an important role in selecting a construction company to develop core sites in Seoul,” said an industry insider. “There is no reason to combine the brands and any attempt to do so may also face a backlash from Daewoo E&C employees.” (Reporting by Jin-young Ko)