Hyundai Heavy open to bidding for $2.9bn Hynix stake

SEOUL: Hyundai Heavy Industries is open to participating in the auction of a $2.9 billion stake in Hynix Semiconductor , a company source said on Wednesday, sending shares in the world's biggest shipyard down as much as 7.2 percent.

In a prolonged search for a new owner for the world's No.2 memory chipmaker, creditors-turned-shareholders of Hynix are now considering selling new shares as well as their combined 15 percent stake in a bid to give potential buyers various options.

Leading Hynix shareholders plan to put up a public notice in mid-June for the sale of their stake worth $2.9 billion.

Creditors rescued Hynix from a debt crisis in 2001 stemming from one of the industry's worst downturns. They have since scaled down their stake but failed several times to complete a full sale, with investors reluctant to make a risky jump into the cyclical memory chip sector.

The Hyundai source, who asked not to be named because of the sensitivity of the matter, said the firm was looking at Hynix with interest, but declined to elaborate.

Hyundai shares lost 6.2 percent by 0235 GMT, after dropping by more than 7 percent at one point amid market concerns over its potential expansion into a non-core business, while Hynix shares rose 1.4 percent.

"There's uncertainty over the synergy that Hyundai can generate from the potential investment and how it plans to grow the business after acquisition, which is pushing down its shares," said Kim Hong-gyun, an analyst at Dongbu Securities.

Copyright Reuters, 2011