Korea / Special Sits, Pairs, Index Rebalancing, Clepsydra Capital

Sanghyun Park

Korea / Special Sits, Pairs, Index Rebalancing

Clepsydra Capital

Investigate special situations, pairs, and index rebalancing trades in Korea.

Event-Driven

<ul>
<li>A Democratic Party insider noted some proposals need legal tweaks, so the December 10 deadline may slip, but they’re set on passing the expanded director loyalty duty.</li>
<li>FKI analyzed top conglomerates’ shareholder structures and found four of the top 10 facing substantial risks.</li>
<li>We need more clarity before jumping in, but with MBK driving Korea's hostile M&amp;A scene and the Commercial Act amendments, local chaebols facing control battles are a key KOSPI theme.</li>
</ul>


A Democratic Party insider noted some proposals need legal tweaks, so the December 10 deadline may slip, but they’re set on passing the expanded director loyalty duty.
FKI analyzed top conglomerates’ shareholder structures and found four of the top 10 facing substantial risks.
We need more clarity before jumping in, but with MBK driving Korea's hostile M&amp;A scene and the Commercial Act amendments, local chaebols facing control battles are a key KOSPI theme.


Korea Pushes to Expand Director’s Duty of Loyalty: Focus on Hostile Takeover-Risk Conglomerates

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Douglas Research Advisory

Equity Bottom-Up

<ul>
<li>On 28 October, SK Inc (034730 KS) announced its corporate value up program.</li>
<li>Minimum annual DPS was set at 5,000 won. The combination of dividends and share buyback/cancellations would mean that the total shareholder returns could range about 4% to 5% per year. </li>
<li>The company announced its goal of improving its ROE to around 10% in the long-term. From 2021 to 2023, the company's ROE averaged 3.9%.</li>
</ul>


On 28 October, SK Inc (034730 KS) announced its corporate value up program.
Minimum annual DPS was set at 5,000 won. The combination of dividends and share buyback/cancellations would mean that the total shareholder returns could range about 4% to 5% per year. 
The company announced its goal of improving its ROE to around 10% in the long-term. From 2021 to 2023, the company's ROE averaged 3.9%.


SK Inc: Solid Corporate Value Up Plan Muddled by Chairman Chey's Ongoing Divorce Proceeding

<ul>
<li>The new 100% mandatory tender offer rule could push buyers to lower premiums for major shareholders, potentially increasing hostile takeover attempts as costs get shared with minority shareholders.</li>
<li>It looks like MBK is eyeing this situation as a chance to redefine their strategy. This really shows how serious MBK is about the Korea Zinc deal.</li>
<li>Watch for top-tier assets available via hostile takeovers, particularly companies like SK Inc and Lotte Corp, where low shareholder stakes may lead to management conflicts.</li>
</ul>


The new 100% mandatory tender offer rule could push buyers to lower premiums for major shareholders, potentially increasing hostile takeover attempts as costs get shared with minority shareholders.
It looks like MBK is eyeing this situation as a chance to redefine their strategy. This really shows how serious MBK is about the Korea Zinc deal.
Watch for top-tier assets available via hostile takeovers, particularly companies like SK Inc and Lotte Corp, where low shareholder stakes may lead to management conflicts.


Why MBK's Move into Local Hostile Takeover Scene Matters: Focus on SK Inc and Lotte Corp

<ul>
<li>In this insight, we discuss the potential sale of SK Specialty by SK Inc (034730 KS) which owns 100% stake in the company. </li>
<li>If SK Inc could sell SK Specialty at about 3 trillion won to 4 trillion won, this could reduce significantly reduce debt burden of SK Inc.</li>
<li>Our base case NAV value per share for SK Inc is 203,288 won per share, representing 38% upside from current levels.</li>
</ul>


In this insight, we discuss the potential sale of SK Specialty by SK Inc (034730 KS) which owns 100% stake in the company. 
If SK Inc could sell SK Specialty at about 3 trillion won to 4 trillion won, this could reduce significantly reduce debt burden of SK Inc.
Our base case NAV value per share for SK Inc is 203,288 won per share, representing 38% upside from current levels.


Potential Sale of SK Specialty and Deleveraging of the SK Group - Impact on SK Inc and NAV Analysis

<ul>
<li>We discuss the outlook for the likely impact on SK Inc post record divorce ruling for the SK Group Chairman Chey Tae-Won and his estranged wife Roh So-Young. </li>
<li>Last week, a South Korean appellate court ordered Chairman Chey to pay 1.38 trillion won to Roh. Chey is appealing this case and the Supreme Court's ruling is still pending. </li>
<li>It is in the best interest of SK Inc to raise the overall value of the company since the payment of the divorce is mostly based in cash.</li>
</ul>


We discuss the outlook for the likely impact on SK Inc post record divorce ruling for the SK Group Chairman Chey Tae-Won and his estranged wife Roh So-Young. 
Last week, a South Korean appellate court ordered Chairman Chey to pay 1.38 trillion won to Roh. Chey is appealing this case and the Supreme Court's ruling is still pending. 
It is in the best interest of SK Inc to raise the overall value of the company since the payment of the divorce is mostly based in cash.


Impact on SK Inc Post Record Divorce Ruling for SK Group Chairman Chey Tae-Won

South Korea

SK Holdings Co., Ltd. is a holdings company that is engaged in various industries including energy, chemicals, information technology, semiconductors, marketing, and services businesses in South Korea and internationally.

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SK Inc (034730 KS)

Korea Pushes to Expand Director’s Duty of Loyalty: Focus on Hostile Takeover-Risk Conglomerates

Korea’s majority party is doubling down on expanding the director’s duty of loyalty to include shareholders. This post spotlights on major chaebols...

Sanghyun Park

SK Inc: Solid Corporate Value Up Plan Muddled by Chairman Chey's Ongoing Divorce Proceeding

SK Inc announced its corporate value up program. The combination of dividends and share buyback/cancellations would mean that the total shareholder...

Douglas Kim

Why MBK's Move into Local Hostile Takeover Scene Matters: Focus on SK Inc and Lotte Corp

This post investigates the reasons MBK has suddenly ventured into the hostile takeover market in Korea and discusses why we should pay attention to...

Sanghyun Park

Potential Sale of SK Specialty and Deleveraging of the SK Group - Impact on SK Inc and NAV Analysis

In this insight, we discuss the potential sale of SK Specialty by SK Inc (034730 KS) which owns 100% stake in the company. Our NAV value of SK Inc...

Douglas Kim

Impact on SK Inc Post Record Divorce Ruling for SK Group Chairman Chey Tae-Won

Major SK Group companies plan to convene on 28 June to discuss reorganization/sales of major SK Group affiliates. Three companies in particular are...

Douglas Kim

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