MG Insurance Due Diligence Advances with Meritz

On February 7, Meritz Fire & Marine Insurance is scheduled to commence on-site due diligence of MG Insurance, marking a pivotal step in the protracted acquisition process of the financially beleaguered insurance company. The due diligence, initially set for around 2 PM, remains contingent on final negotiations between Meritz, MG Insurance, and the union concerning key issues. The union had previously opposed the acquisition, voicing concerns about potential information leaks and employment succession, challenges not uncommon in South Korea given the influential role of labor unions in corporate transactions. However, MG Insurance has received a confidentiality agreement from Meritz Fire & Marine to prevent business information obtained during the due diligence from being disclosed, thus facilitating this critical stage to advance. Meritz, a prominent player in South Korea’s insurance sector, was chosen on December 9 as the preferred negotiation partner after MG Insurance’s struggles with financial instability prompted KDIC to consider potential liquidation. The due diligence process is integral in M&A, providing Meritz insight into MG Insurance's business, finance, and legal standings. KDIC has stressed the urgency of swiftly completing this process to resume the stalled sale, vital to stabilizing MG Insurance’s precarious financial condition and averting liquidation.