Texas-based investment firm Newbridge Capital Ltd. is in talks with HSBC Holdings PLC to sell its approximately 49 percent stake in Korea First Bank, a government source said.
HSBC, Britain's largest bank, is likely to pay about 3 trillion to 3.5 trillion Korean won for the Seoul-based lender, or about $2.7 billion to $3.2 billion.
"Newbridge has been talking to HSBC to sell its stake," said the source, who declined to be named.
The government sold a controlling 51 percent stake to Fort Worth-based Newbridge in December 1999 as part of a restructuring in the financial sector.
But Newbridge now owns a 48.56 percent stake due to a warrant conversion by the South Korean government.
If successful, HSBC's acquisition will mark one of the largest foreign investment made in the country, following Citigroup Inc.'s recent purchase of mid-size lender KorAm Bank worth $2.68 billion.