DGB dividends expected to rise after sale of financial arms
DGB Financial Group’s dividend per share is expected to rise following the sale of its indirect subsidiaries Hi Asset Management and Hi Investment & Futures, analysts said on June 3.
Its potential nonoperating income from the sell-off in the third quarter, estimated at a combined 106.2 billion won ($89.9 million), is expected to contribute to the boost.
“The sell-off is a one-time event so we have keep the target price unchanged, but it is still positive news for DGB Group investors as they can expect room for more dividends,” Choi Chung-uk, an analyst at Hana Financial Investment, wrote in a note to investors.
Choi expects the dividend yield to be 5.3 percent in 2019, up 1 percentage point on-year, and its dividend per share to reach 430 won, up 19.4 percent.
On May 23, DGB Financial Group said in a disclosure that its direct subsidiary Hi Investment & Securities had agreed to sell its entire stake -- 92.4 percent of Hi Asset Management -- to Hong Kong-based securities brokerage house Hai Tian International Securities, for 77.6 billion won.
Seoul-based BankerStreet Private Equity will ac 65.2 percent stake in another financial arm -- Hi Investment & Futures -- for 28.6 billion won.
DGB added on May 27 the deals will be sealed on Sept. 24 this year.
DGB’s nonoperating gain from the stake sell-off after tax deductions will amount to 22 billion won, according to Choi.
Hai Tian International Securities and BankerStreet Private Equtiy formed a consortium to acquire the two companies.
By Son Ji-hyoung (consnow@heraldcorp.com)