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Thursday November 16, 6:32 PMCHRONOLOGY-Key events after Lone Star buys KEB in 2003Nov 16 (Reuters) - A South Korean court issued warrants on Thursday to detain two senior executives of U.S. private equity fund Lone Star [LS.UL] for questioning in a stock trading probe, a judge at the Seoul Central District Court said.Prosecutors have been searching for any irregularities in the way Lone Star bought Korea Exchange Bank (KEB) in 2003. The probes are increasingly viewed as potential hindrances to the planned $7.34 billion sale of up to a 71 percent stake of KEB to Kookmin Bank . They have also made investors grow wary of anti-foreign sentiment in South Korea. Here is a chronology of events since Lone Star bought a 50.5 percent stake in KEB for $1.2 billion in August 2003: - Feb. 28, 2004: KEB absorbs KEB Credit Service Co. Ltd. - April 14, 2005: Lone Star and other foreign funds start to be investigated in South Korea over possible tax irregularities. - Sept. 29, 2005: The National Tax Service imposes more than $200 million in taxes on five foreign funds, including Lone Star, for their recent deals in South Korea. - Feb. 24, 2006: The regulatory Financial Supervisory Service says it will report Lone Star Advisors Korea and its affiliate Hudson Advisors Korea to prosecutors for alleged violations of foreign currency law. - Feb. 27, 2006: A South Korean parliamentary panel votes to ask prosecutors to investigate whether Lone Star's purchase of KEB in 2003 was proper. - April 19, 2006: Lone Star Chairman John Grayken says at a news conference in Seoul that Steven Lee, former head of Lone Star's South Korean operations, has been fired for misappropriating funds and will be sued by the company. He says the fund will donating 100 billion won to charity. - May 11, 2006: The Seoul Central District Court rejects a prosecutors' request to arrest Paul Yoo, president of Lone Star Advisors Korea, saying he doesn't represent a flight risk. - May 19, 2006: Kookmin Bank signs a final deal worth as much as $7.34 billion to purchase KEB from Lone Star and two other major shareholders. - June 19, 2006: The Board of Audit and Inspection says Lone Star's 2003 purchase of KEB contained some flaws but clears Lone Star of any impropriety, while leaving the door open to possible sanctions by prosecutors. - June 20, 2006: The Financial Supervisory Commission says its approval of the Lone Star's transaction in 2003 was proper and disagrees with the audit board's argument that financial difficulties at KEB had been exaggerated. - Sept. 18, 2006: Lone Star wants Kookmin Bank to pay more to reflect KEB's improved earnings during a protracted sale, KEB Chief Executive Richard Wacker says in a speech to employees. - Nov. 3, 2006: The Seoul Central District Court rejects prosecutors' request to detain Ellis Short, Lone Star's vice chairman and Michael Thomson, its general counsel. It also rebuffs prosecutors' plan to arrest Paul Yoo again. - Nov. 6, 2006: Prosecutors arrest Lee Kang-won, who was KEB's chief executive at the time of the sale to Lone Star, for breach of trust and other charges. - Nov. 8, 2006: The Seoul Central District Court again rejects a prosecutors' request to detain Short and Thomson and to arrest Yoo. - Nov. 16, 2006: The Seoul Central District Court approves prosecutors' requests to detain Short and Thomson, but again rejects the request to arrest Yoo. |
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