Hanwha Group, a South Korean chemical conglomerate, said Friday that it will not join the race to buy LIG Insurance Co., the country's fifth-largest non-life insurer.

"It is not true that Hanwha Group is seeking a takeover of LIG Insuarance," it said in a regulatory filing.

LIG Group, a mid-sized local business group, put up a 20.9 percent stake in its non-life insurance unit, LIG Insurance, to secure cash to compensate investors for losses incurred from its 2011 financial fraud scandal.

The sale of the stake in the non-life insurer has drawn two bidders -- Tong Yang Life Insuarance Co., the country's fifth-largest insurer, and local food and retail conglomerate Lotte Group.

Mid-sized non-life insurer Meritz Fire & Marine Insurance Co. and the South Korea's second-largest banking firm KB Financial Group Inc. are also said to be mulling the takeover.

Late last year, LIG Group selected Goldman Sachs as the manager to sell its non-life insurance subsidiary.

LIG Insurance recorded a net profit of 103.9 billion won ($98 million) in the April-September period of 2013 and a revenue of 5.66 trillion won. (Yonhap News)