A sale process of AXA General Insurance Co Ltd, French multinational insurance group AXA’s South Korean unit, may fizzle out, with Shinhan Financial Group walking away from the deal.

Samjong KPMG which is leading the sale process of AXA General Insurance held a first round of bidding on September 18, industry sources said. Shinhan Financial Group mulled over the possible participation until the last minute, and decided not to join the race.

Last year the South Korean financial services conglomerate expressed interest in Hana Insurance – formerly known as The-K Non-Life Insurance – although it also withdrew at the last minute. Hana Insurance is said to have a similar business profile to AXA General Insurance.

Market insiders raise the possibility of the cancellation of the whole sale process itself as the strong candidate Shinhan Financial Group has pulled out of the deal. Kyobo Life Insurance, which submitted its non-binding offer, is also not considered a genuine potential buyer of the non-life insurer, considering its available funds and its current progress.

Market insiders now expect the further process may not be taken place if AXA Group thinks it would not be able to hold a competitive bidding due to a tepid results of the preliminary bidding results. It is said that potential buyers have not yet been informed of any further process.

The non-life insurance company was set up by Korea Direct in 2000 and taken over by Kyobo Life Insurance in the following year, before the French insurer purchased a 74.7% stake in 2007. AXA bought the remaining shares in 2009 and the company has since positioned itself as an online insurance platform specializing in auto insurance products. (Reporting by Ar-rum Rho)