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

<p>Hanwha Systems' ₩1.2T offering subscription rights trade begins <strong>May 13 (this Thursday)</strong>. It will last for 5 trading sessions until May 20.</p><table class="table table-striped"><tbody>
<tr><td colspan="2" style="width: 723.636px;" data-sheets-value='{"1":2,"2":"Timetable"}'>Timetable</td></tr>
<tr>
<td style="width: 364.545px;" data-sheets-value='{"1":2,"2":"Subscription rights trade beginning"}'><strong>Subscription rights trade</strong></td>
<td style="text-align: right; width: 338.182px;" data-sheets-value='{"1":3,"3":44329}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'><strong>2021. 5. 13 ~ 5. 20</strong></td>
</tr>
<tr>
<td style="width: 364.545px;" data-sheets-value='{"1":2,"2":"Final pricing"}'><strong>Final pricing</strong></td>
<td style="text-align: right; width: 338.182px;" data-sheets-value='{"1":3,"3":44347}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'><strong>2021. 5. 31</strong></td>
</tr>
<tr>
<td style="width: 364.545px;">Subscription</td>
<td style="text-align: right; width: 338.182px;">2021. 6. 03</td>
</tr>
<tr>
<td style="width: 364.545px;">Payment</td>
<td style="text-align: right; width: 338.182px;">2021. 6. 11</td>
</tr>
<tr>
<td style="width: 364.545px;" data-sheets-value='{"1":2,"2":"Listing"}'><strong>Listing</strong></td>
<td style="text-align: right; width: 338.182px;" data-sheets-value='{"1":3,"3":44370}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'><strong>2021. 6. 23</strong></td>
</tr>
<tr><td colspan="2" style="width: 723.636px;" data-sheets-value='{"1":2,"2":"Source: DART"}'>Source: DART</td></tr>
</tbody></table><p><strong>The 1st round price settled at ₩15,800, giving an 11.73% discount to the last close</strong>. This price of ₩15,800 will likely serve as our ceiling price in this offering.</p><table class="table table-striped">
<colgroup>
<col width="100">
<col width="100">
</colgroup>
<tbody>
<tr><td colspan="2" rowspan="1" style="width: 723.636px;" data-sheets-value='{"1":2,"2":"1st round pricing"}'>1st round pricing</td></tr>
<tr>
<td style="width: 370.909px;" data-sheets-value='{"1":2,"2":"Calculation period"}'>Calculation period</td>
<td style="text-align: right; width: 331.818px;" data-sheets-value='{"1":2,"2":"2021.03.20 ~ 2021.04.19"}'><div><div>2021.03.20 ~ 2021.04.19</div></div></td>
</tr>
<tr>
<td style="width: 370.909px;" data-sheets-value='{"1":2,"2":"Reference date"}'><strong>Reference date</strong></td>
<td style="text-align: right; width: 331.818px;" data-sheets-value='{"1":3,"3":44305}' data-sheets-numberformat='{"1":5,"2":"mmmm d","3":1}'><strong>April 19</strong></td>
</tr>
<tr>
<td style="width: 370.909px;" data-sheets-value='{"1":2,"2":"1-month volume weighted average price"}'>1-month volume-weighted average price (VWAP)</td>
<td style="text-align: right; width: 331.818px;" data-sheets-value='{"1":3,"3":20817}' data-sheets-numberformat='{"1":4,"2":"[$₩]#,##0","3":1}'>₩20,817</td>
</tr>
<tr>
<td style="width: 370.909px;" data-sheets-value='{"1":2,"2":"1-week volume weighted average price"}'>1-week volume-weighted average price (VWAP)</td>
<td style="text-align: right; width: 331.818px;" data-sheets-value='{"1":3,"3":20222}' data-sheets-numberformat='{"1":4,"2":"[$₩]#,##0","3":1}'>₩20,222</td>
</tr>
<tr>
<td style="width: 370.909px;" data-sheets-value='{"1":2,"2":"1-day close on April 19"}'>1-day close on April 19</td>
<td style="text-align: right; width: 331.818px;" data-sheets-value='{"1":3,"3":20600}' data-sheets-numberformat='{"1":4,"2":"[$₩]#,##0","3":1}'>₩20,600</td>
</tr>
<tr>
<td style="width: 370.909px;" data-sheets-value='{"1":2,"2":"(A+B+C)/3"}'>(A+B+C)/3</td>
<td style="text-align: right; width: 331.818px;" data-sheets-value='{"1":3,"3":20546}' data-sheets-numberformat='{"1":4,"2":"[$₩]#,##0","3":1}'>₩20,546</td>
</tr>
<tr>
<td style="width: 370.909px;" data-sheets-value='{"1":2,"2":"Reference price: Min(C,D)"}'><strong>Reference Price: Min(C,D)</strong></td>
<td style="text-align: right; width: 331.818px;" data-sheets-value='{"1":3,"3":20546}' data-sheets-numberformat='{"1":4,"2":"[$₩]#,##0","3":1}' data-sheets-formula="=R[-1]C[0]"><strong>₩20,546</strong></td>
</tr>
<tr>
<td style="width: 370.909px;" data-sheets-value='{"1":2,"2":"Discount rate"}'>Discount rate</td>
<td style="text-align: right; width: 331.818px;" data-sheets-value='{"1":3,"3":0.15}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>15.00%</td>
</tr>
<tr>
<td style="width: 370.909px;" data-sheets-value='{"1":2,"2":"Capital increase rate"}'>Capital increase rate</td>
<td style="text-align: right; width: 331.818px;" data-sheets-value='{"1":2,"2":"71,39%"}'>71,39%</td>
</tr>
<tr>
<td style="width: 370.909px;" data-sheets-value='{"1":2,"2":"1st round price: Reference Price × (1 - 15%) / [1 + (71.39% × 15%)]"}'><strong>1st round price: Reference Price × (1 - 15%) / [1 + (71.39% × 15%)]</strong></td>
<td style="text-align: right; width: 331.818px;" data-sheets-value='{"1":3,"3":15800}' data-sheets-numberformat='{"1":4,"2":"[$₩]#,##0","3":1}'><strong>₩15,800</strong></td>
</tr>
<tr><td colspan="2" rowspan="1" style="width: 723.636px;" data-sheets-value='{"1":2,"2":"Source: DART"}'>Source: DART</td></tr>
</tbody>
</table><hr><p><strong>Why does this subscription rights trade deserve attention?</strong></p><div><ul>
<li>Korea now has the short-selling restriction to ban short-sellers from participating in a rights offer. Those having shorted between a day after an offering announcement day and an offering price-fixing day face the restriction.</li>
<li>But this restriction applies only to the offerings announced after April 6. <strong>This Hanwha Systems offering allows us to enjoy the loophole for the last time,</strong> as the offering announcement was made on <strong>March 29</strong>.</li>
</ul></div>

Hanwha Systems' ₩1.2T offering subscription rights trade begins May 13 (this Thursday). It will last for 5 trading sessions until May 20.
Timetable

Subscription rights trade
2021. 5. 13 ~ 5. 20


Final pricing
2021. 5. 31


Subscription
2021. 6. 03


Payment
2021. 6. 11


Listing
2021. 6. 23

Source: DART
The 1st round price settled at ₩15,800, giving an 11.73% discount to the last close. This price of ₩15,800 will likely serve as our ceiling price in this offering.





1st round pricing

Calculation period
2021.03.20 ~ 2021.04.19


Reference date
April 19


1-month volume-weighted average price (VWAP)
₩20,817


1-week volume-weighted average price (VWAP)
₩20,222


1-day close on April 19
₩20,600


(A+B+C)/3
₩20,546


Reference Price: Min(C,D)
₩20,546


Discount rate
15.00%


Capital increase rate
71,39%


1st round price: Reference Price × (1 - 15%) / [1 + (71.39% × 15%)]
₩15,800

Source: DART

Why does this subscription rights trade deserve attention?
Korea now has the short-selling restriction to ban short-sellers from participating in a rights offer. Those having shorted between a day after an offering announcement day and an offering price-fixing day face the restriction.
But this restriction applies only to the offerings announced after April 6. This Hanwha Systems offering allows us to enjoy the loophole for the last time, as the offering announcement was made on March 29.


Hanwha Systems Subscription Rights Trading Begins May 13: Should Aim at the First Day

<p>Korea had been one of the few countries that allowed short sellers to participate in a rights offering.</p><p>Even if you shorted the shares of a company after it had announced a rights offer, you could still <span>subscribe to new rights and repay the shorted shares with new rights.</span></p><p><span>Now, starting April 6, this practice is no longer allowed.</span></p><p><span>There had been several attempts to close this loophole in the past. But none of these attempts </span><span>hadn't even passed the parliament's preliminary session.</span></p><p><span>Finally, this time, obviously to sweeten the public-angering short-selling resumption on May 3, the latest attempt by the Korea FSC got the lawmakers' approval.</span></p><div class="content-highlight">
<p><em><a href="https://www.korea.kr/news/pressReleaseView.do?newsId=156443917" target="_blank" rel="noopener">Here is the link to the Capital Market and Financial Investment Business Act Enforcement Decree, containing the closing of this practice.</a></em></p>
<p><em>(Source: www.Korea.kr)</em></p>
</div>

Korea had been one of the few countries that allowed short sellers to participate in a rights offering.Even if you shorted the shares of a company after it had announced a rights offer, you could still subscribe to new rights and repay the shorted shares with new rights.Now, starting April 6, this practice is no longer allowed.There had been several attempts to close this loophole in the past. But none of these attempts hadn't even passed the parliament's preliminary session.Finally, this time, obviously to sweeten the public-angering short-selling resumption on May 3, the latest attempt by the Korea FSC got the lawmakers' approval.
Here is the link to the Capital Market and Financial Investment Business Act Enforcement Decree, containing the closing of this practice.
(Source: www.Korea.kr)


Korea's New Short Selling Restriction to Close the Loophole for Arb Trading on a Rights Offer

<p>We are one trading session before the 1st-round pricing for the Hanwha Systems ₩1.2T offers.</p><p>The pricing is next Monday, April 19. </p><div><div><table class="table table-striped"><tbody>
<tr><td colspan="2" style="width: 723.636px;" data-sheets-value='{"1":2,"2":"Timetable"}'>Timetable</td></tr>
<tr>
<td style="width: 350.909px;" data-sheets-value='{"1":2,"2":"Preliminary pricing"}'><strong>Preliminary pricing</strong></td>
<td style="text-align: right; width: 351.818px;" data-sheets-value='{"1":3,"3":44305}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'><strong>2021. 4. 19</strong></td>
</tr>
<tr>
<td style="width: 350.909px;" data-sheets-value='{"1":2,"2":"Ex-rights date"}'><strong>Ex-rights date</strong></td>
<td style="text-align: right; width: 351.818px;" data-sheets-value='{"1":3,"3":44307}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'><strong>2021. 4. 21</strong></td>
</tr>
<tr>
<td style="width: 350.909px;" data-sheets-value='{"1":2,"2":"Record date"}'>Record date</td>
<td style="text-align: right; width: 351.818px;" data-sheets-value='{"1":3,"3":44308}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'>2021. 4. 22</td>
</tr>
<tr>
<td style="width: 350.909px;" data-sheets-value='{"1":2,"2":"Subscription rights trade beginning"}'>Subscription rights trade beginning</td>
<td style="text-align: right; width: 351.818px;" data-sheets-value='{"1":3,"3":44329}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'>2021. 5. 13</td>
</tr>
<tr>
<td style="width: 350.909px;" data-sheets-value='{"1":2,"2":"Subscription rights trade ending"}'>Subscription rights trade ending</td>
<td style="text-align: right; width: 351.818px;" data-sheets-value='{"1":3,"3":44329}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'>2021. 5. 20</td>
</tr>
<tr>
<td style="width: 350.909px;" data-sheets-value='{"1":2,"2":"Final pricing"}'>Final pricing</td>
<td style="text-align: right; width: 351.818px;" data-sheets-value='{"1":3,"3":44347}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'>2021. 5. 31</td>
</tr>
<tr>
<td style="width: 350.909px;" data-sheets-value='{"1":2,"2":"Listing"}'>Listing</td>
<td style="text-align: right; width: 351.818px;" data-sheets-value='{"1":3,"3":44370}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'>2021. 6. 23</td>
</tr>
<tr><td colspan="2" style="width: 723.636px;" data-sheets-value='{"1":2,"2":"Source: DART"}'>Source: DART</td></tr>
</tbody></table></div></div><div>
<table class="table table-striped">
<colgroup>
<col width="350">
<col width="350">
</colgroup>
<tbody>
<tr><td colspan="2" rowspan="1" data-sheets-value='{"1":2,"2":"Pricing"}'>Pricing</td></tr>
<tr>
<td data-sheets-value='{"1":2,"2":"1st round"}'><strong>1st round</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"RP × (1 - 15%) / [1 + (71.39% × 15%)]"}' data-sheets-formula='="RP × (1 - "&amp;(R[11]C[0]*100&amp;"%")&amp;") / [1 + ("&amp;(R[12]C[0]*100&amp;"%"&amp;" × "&amp;(R[11]C[0]*100&amp;"%"&amp;")]"))'><strong>RP × (1 - 15%) / [1 + (71.39% × 15%)]</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Reference price (RP)"}'><strong>- Reference price (RP)</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Min [Close, Avg (Close, 1W VWAP, 1M VWAP)]"}'><strong>Min [Close, Avg (Close, 1W VWAP, 1M VWAP)]</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Reference date"}'><strong>- Reference date</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44305}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}' data-sheets-formula="=Terms!R[41]C[0]"><strong>2021. 4. 19</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Ex-rights base price"}'>Ex-rights base price</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"[RP + (1st × 71.39%)] / (1 + 71.39%)"}' data-sheets-formula='="[RP + (1st × "&amp;R[9]C[0]*100&amp;"%"&amp;")] / (1 + "&amp;R[9]C[0]*100&amp;"%"&amp;")"'>[RP + (1st × 71.39%)] / (1 + 71.39%)</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Reference price (RP)"}'>- Reference price (RP)</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Previous close"}'>Previous close</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Reference date"}'>- Reference date</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44307}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}' data-sheets-formula="=Terms!R[39]C[0]">2021. 4. 21</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"2nd round"}'>2nd round</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"RP × (1 - 15%)"}' data-sheets-formula='="RP × (1 - "&amp;(R[5]C[0]*100&amp;"%")&amp;")"'>RP × (1 - 15%)</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Reference price (RP)"}'>- Reference price (RP)</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Min [Close, Avg (Close, 1W VWAP)]"}'>Min [Close, Avg (Close, 1W VWAP)]</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Reference date"}'>- Reference date</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44347}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}' data-sheets-formula="=Terms!R[40]C[0]">2021. 5. 31</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Final"}'>Final</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Max [Min (1st, 2nd), 3D VWAP × 60%]"}'>Max [Min (1st, 2nd), 3D VWAP × 60%]</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Reference date"}'>- Reference date</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44347}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}' data-sheets-formula="=Terms!R[38]C[0]">2021. 5. 31</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Discount rate"}'>Discount rate</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.15}' data-sheets-numberformat='[null,3,"0.00%",1]'>15.00%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Capital increase rate"}'>Capital increase rate</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.7139}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=LEFT(Terms!R[11]C[0],6)*100/100">71.39%</td>
</tr>
<tr><td colspan="2" rowspan="1" data-sheets-value='{"1":2,"2":"Source: DART"}'>Source: DART</td></tr>
</tbody>
</table>
<p>As I'm writing this post, the share price is ₩20,150 with a 1W VWAP of ₩20,120 and a 1M VWAP of ₩20,829, giving a preliminary RP of ₩20,150.</p>
<p>The 1st round offering price then arrives at ₩15,500 at a discount rate of 15% and a capital increase of 71.39%.</p>
<table class="table table-striped">
<colgroup>
<col width="100">
<col width="100">
</colgroup>
<tbody>
<tr><td colspan="2" rowspan="1" data-sheets-value='{"1":2,"2":"1st round pricing"}'>1st round pricing</td></tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Date"}'>Date</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44305}' data-sheets-numberformat='{"1":5,"2":"yyyy\". \"m\". \"d","3":1}'>2021. 4. 19</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"1D VWAP"}'>Previous close</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":20150}' data-sheets-numberformat='{"1":4,"2":"[$₩]#,##0"}' data-sheets-formula='=googlefinance(R[-27]C[3], "price")'>₩20,150</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"1W VWAP"}'>1W VWAP</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":20119.55102347699}' data-sheets-numberformat='{"1":4,"2":"[$₩]#,##0"}' data-sheets-formula="=R[-7]C[2]">₩20,120</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"1M VWAP"}'>1M VWAP</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":20828.708137926085}' data-sheets-numberformat='{"1":4,"2":"[$₩]#,##0"}' data-sheets-formula="=R[-7]C[2]">₩20,829</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Average"}'>- Average</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":20366.086387134357}' data-sheets-numberformat='{"1":4,"2":"[$₩]#,##0"}' data-sheets-formula="=sum(R[-3]C[0]:R[-1]C[0])/3">₩20,366</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Reference price"}'><strong>Reference price</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":20150}' data-sheets-numberformat='{"1":4,"2":"[$₩]#,##0"}' data-sheets-formula="=min(R[-4]C[0], R[-1]C[0])"><strong>₩20,150</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"1st round price"}'><strong>1st round price</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":15500}' data-sheets-numberformat='{"1":4,"2":"[$₩]#,##0"}' data-sheets-formula="=ceiling.math((R[-1]C[0]*(1-R[-20]C[5]))/((1+(R[-19]C[5]*R[-20]C[5]))), 100)"><strong>₩15,500</strong></td>
</tr>
<tr><td colspan="2" rowspan="1" data-sheets-value='{"1":2,"2":"Source: DART"}'>Source: DART</td></tr>
</tbody>
</table>
<table class="table table-striped">
<colgroup>
<col width="100">
<col width="100">
</colgroup>
<tbody>
<tr><td colspan="2" data-sheets-value='{"1":2,"2":"Ex-rights base price"}'>Ex-rights base price</td></tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Date"}'>Date</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44307}' data-sheets-numberformat='{"1":5,"2":"yyyy\". \"m\". \"d","3":1}'>2021. 4. 21</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Previous close"}'>Previous close</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":20150}' data-sheets-numberformat='{"1":4,"2":"[$₩]#,##0"}' data-sheets-formula="=R[-10]C[0]">₩20,150</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"1st round"}'>1st round</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":15500}' data-sheets-numberformat='{"1":4,"2":"[$₩]#,##0"}' data-sheets-formula="=R[-6]C[0]">₩15,500</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Ex-rights base price"}'>Ex-rights base price</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":18300}' data-sheets-numberformat='{"1":4,"2":"[$₩]#,##0"}' data-sheets-formula="=ceiling.math(((R[-2]C[0]+(R[-1]C[0]*R[-26]C[5]))/(1+R[-26]C[5])), 100)">₩18,300</td>
</tr>
<tr>
<td> - % to close</td>
<td style="text-align: right;">-9.41%</td>
</tr>
<tr><td colspan="2" data-sheets-value='{"1":2,"2":"Source: KRX KIND"}'>Source: KRX KIND</td></tr>
</tbody>
</table>
</div>

We are one trading session before the 1st-round pricing for the Hanwha Systems ₩1.2T offers.The pricing is next Monday, April 19. 
Timetable

Preliminary pricing
2021. 4. 19


Ex-rights date
2021. 4. 21


Record date
2021. 4. 22


Subscription rights trade beginning
2021. 5. 13


Subscription rights trade ending
2021. 5. 20


Final pricing
2021. 5. 31


Listing
2021. 6. 23

Source: DART







Pricing

1st round
RP × (1 - 15%) / [1 + (71.39% × 15%)]


- Reference price (RP)
Min [Close, Avg (Close, 1W VWAP, 1M VWAP)]


- Reference date
2021. 4. 19


Ex-rights base price
[RP + (1st × 71.39%)] / (1 + 71.39%)


- Reference price (RP)
Previous close


- Reference date
2021. 4. 21


2nd round
RP × (1 - 15%)


- Reference price (RP)
Min [Close, Avg (Close, 1W VWAP)]


- Reference date
2021. 5. 31


Final
Max [Min (1st, 2nd), 3D VWAP × 60%]


- Reference date
2021. 5. 31


Discount rate
15.00%


Capital increase rate
71.39%

Source: DART


As I'm writing this post, the share price is ₩20,150 with a 1W VWAP of ₩20,120 and a 1M VWAP of ₩20,829, giving a preliminary RP of ₩20,150.
The 1st round offering price then arrives at ₩15,500 at a discount rate of 15% and a capital increase of 71.39%.






1st round pricing

Date
2021. 4. 19


Previous close
₩20,150


1W VWAP
₩20,120


1M VWAP
₩20,829


- Average
₩20,366


Reference price
₩20,150


1st round price
₩15,500

Source: DART








Ex-rights base price

Date
2021. 4. 21


Previous close
₩20,150


1st round
₩15,500


Ex-rights base price
₩18,300


 - % to close
-9.41%

Source: KRX KIND




Hanwha Systems Rights Offer: Outright Trade on Subs Rights Ahead of Ex-Rights

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

Equity Capital Markets

Hanwha Systems Co Ltd / Equity Capital Markets

<p>In this insight, we discuss the details of <a href="https://www.smartkarma.com/entities/hanwha-systems-co-ltd" target="_blank" data-smartkarma-citation="entities:28308:1" rel="noopener">Hanwha Systems Co Ltd (272210 KS)'s</a> big rights offering (1.2 trillion won or $1.1 billion) on 29 March. In addition, we discuss the impact of the launch of ARK's Space Exploration ETF, which is taking place this week, on the rights offering of Hanwha Systems. </p><div class="content-highlight">
<p>All in all, we have a positive view of Hanwha Systems' big rights offering plan. We like the company's strategy of carving out its business strength in the space exploration related sectors including satellite, aerospace, and aviation mobility. </p>
<p>Clearly, Hanwha Systems is taking the lead in Korea in the rapidly growing space exploration sector and we believe this company can become a credible force in this sector in the coming years. As more investors begin to understand the company's motives and strategies, it is also possible for Hanwha Systems to eventually become included in the ARK Space Exploration ETF as well. </p>
</div>

In this insight, we discuss the details of Hanwha Systems Co Ltd (272210 KS)'s big rights offering (1.2 trillion won or $1.1 billion) on 29 March. In addition, we discuss the impact of the launch of ARK's Space Exploration ETF, which is taking place this week, on the rights offering of Hanwha Systems. 
All in all, we have a positive view of Hanwha Systems' big rights offering plan. We like the company's strategy of carving out its business strength in the space exploration related sectors including satellite, aerospace, and aviation mobility. 
Clearly, Hanwha Systems is taking the lead in Korea in the rapidly growing space exploration sector and we believe this company can become a credible force in this sector in the coming years. As more investors begin to understand the company's motives and strategies, it is also possible for Hanwha Systems to eventually become included in the ARK Space Exploration ETF as well. 


Hanwha Systems: Announces A Big Rights Offering & The Launch of ARK's Space Exploration ETF

<p>Hanwha Systems announced a ₩1.2T rights offer at a 71.39% capital increase rate.</p><p>Per-share allocation for stockholders is 0.58124 as 20% goes to the ESOP.</p><p>The pricing discount is 15%, a little more aggressive than the usual 20%.</p><p>The ex-rights fall on April 21, with the preliminary pricing on April 19. The final pricing will be out on May 31. You can trade subscription rights between May 13~20.</p><table class="table table-striped">
<colgroup>
<col width="300">
<col width="300">
</colgroup>
<tbody>
<tr><td colspan="2" rowspan="1" data-sheets-value='{"1":2,"2":"Overview"}'>Overview</td></tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Issuer"}'>Issuer</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Hanwha Systems Co Ltd"}' data-sheets-formula='=googlefinance(R[1]C[0], "name")'>Hanwha Systems Co Ltd</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Ticker"}'>Ticker</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"272210"}' data-sheets-formula='="272210"'>272210</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Target"}'>Target</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"A public offering of forfeited shares after offering to stockholders"}'>A public offering of forfeited shares after offering to stockholders</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Transferability"}'>Transferability</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Renounceable"}'>Renounceable</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Volume"}'>Volume</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":78689000}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>78,689,000</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Bonus issue volume"}'>Bonus issue volume</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>0</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Preliminary price"}'>Preliminary price</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":15250}' data-sheets-numberformat='{"1":2,"2":"[$₩-412]#,##0","3":1}'>₩15,250</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Preliminary value"}'>Preliminary value</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":1200007250000}' data-sheets-numberformat='{"1":2,"2":"[$₩-412]#,##0","3":1}' data-sheets-formula="=R[-3]C[0]*R[-1]C[0]">₩1,200,007,250,000</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Oversubscription privilege"}'>Oversubscription privilege</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.2}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>20.00%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Banker"}'>Banker</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Daishin &amp; KIS"}'>Daishin &amp; KIS</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Underwriting type"}'>- Underwriting type</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Standby"}'>Standby</td>
</tr>
<tr><td colspan="2" rowspan="1" data-sheets-value='{"1":2,"2":"Source: DART"}'>Source: DART</td></tr>
</tbody>
</table><table class="table table-striped">
<colgroup>
<col width="300">
<col width="300">
</colgroup>
<tbody>
<tr><td colspan="2" rowspan="1" data-sheets-value='{"1":2,"2":"Allocation"}'>Allocation</td></tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Common"}'>Common</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":110230389}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}' data-sheets-formula='=googlefinance(R[-13]C[0], "shares")'>110,230,389</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Pref (incl. RCPS &amp; CPS)"}'>Pref (incl. RCPS &amp; CPS)</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>0</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Total shares"}'>Total shares</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":110230389}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}' data-sheets-formula="=R[-2]C[0]+R[-1]C[0]">110,230,389</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Treasury shares"}'>Treasury shares</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":1926128}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>1,926,128</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Total shares ex treasury shares"}'>Total shares ex treasury shares</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":108304261}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}' data-sheets-formula="=R[-2]C[0]-R[-1]C[0]">108,304,261</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Offer volume"}'><strong>Offer volume</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":78689000}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}' data-sheets-formula="=R[1]C[0]+R[2]C[0]"><strong>78,689,000</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Common"}'><strong>- Common</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":78689000}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}' data-sheets-formula="=R[-16]C[0]"><strong>78,689,000</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Pref"}'><strong>- Pref</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'><strong>0</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Per-share allocation"}'><strong>Per-share allocation</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.58124398263518}' data-sheets-numberformat='{"1":2,"2":"#,##0.0000000","3":1}' data-sheets-formula="=R[15]C[0]/R[-4]C[0]"><strong>0.5812440</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Capital increase"}'>Capital increase</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.7138594058667433}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula="=R[-4]C[0]/R[-7]C[0]">71.39%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Dilution"}'>Dilution</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.41652156730191414}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula="=R[-5]C[0]/(R[-8]C[0]+R[-5]C[0])">41.65%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Total shares after rights offer"}'>Total shares after rights offer</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":188919389}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}' data-sheets-formula="=R[1]C[0]+R[2]C[0]">188,919,389</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Common"}'>- Common</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":188919389}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}' data-sheets-formula="=R[-12]C[0]+R[-7]C[0]">188,919,389</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Pref"}'>- Pref</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}' data-sheets-formula="=R[-12]C[0]">0</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Bonus issue"}'>Bonus issue</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}' data-sheets-formula="=R[1]C[0]+R[2]C[0]">0</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Common"}'>- Common</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>0</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Pref"}'>- Pref</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>0</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Per-share allocation"}'>Per-share allocation</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0}' data-sheets-numberformat='{"1":2,"2":"#,##0.0000000","3":1}' data-sheets-formula="=R[-3]C[0]/(R[-6]C[0]-R[-14]C[0])">0.0000000</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Total shares after bonus issue"}'>Total shares after bonus issue</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":188919389}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}' data-sheets-formula="=R[1]C[0]+R[2]C[0]">188,919,389</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Common"}'>- Common</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":188919389}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}' data-sheets-formula="=R[-7]C[0]+R[-4]C[0]">188,919,389</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Pref"}'>- Pref</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}' data-sheets-formula="=R[-7]C[0]+R[-4]C[0]">0</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"ESOP allocation"}'>ESOP allocation</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":15737800}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}' data-sheets-formula="=R[-16]C[0]*R[1]C[0]">15,737,800</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - %"}'>- %</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.2}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>20.00%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Stockholder allocation"}'>Stockholder allocation</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":62951200}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}' data-sheets-formula="=R[-18]C[0]-R[-2]C[0]">62,951,200</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - %"}'>- %</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.8}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula="=R[-1]C[0]/R[-19]C[0]">80.00%</td>
</tr>
<tr><td colspan="2" rowspan="1" data-sheets-value='{"1":2,"2":"Source: DART"}'>Source: DART</td></tr>
</tbody>
</table><table class="table table-striped">
<colgroup>
<col width="300">
<col width="300">
</colgroup>
<tbody>
<tr><td colspan="2" rowspan="1" data-sheets-value='{"1":2,"2":"Timetable"}'>Timetable</td></tr>
<tr>
<td data-sheets-value='{"1":2,"2":"BOD meeting"}'>BOD meeting</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44284}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'>2021. 3. 29</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Preliminary pricing"}'>Preliminary pricing</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44305}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'>2021. 4. 19</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Ex-rights date"}'>Ex-rights date</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44307}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'>2021. 4. 21</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Record date"}'>Record date</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44308}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'>2021. 4. 22</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Subscription rights trade beginning"}'>Subscription rights trade beginning</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44329}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'>2021. 5. 13</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Subscription rights trade ending"}'>Subscription rights trade ending</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44329}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'>2021. 5. 20</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Final pricing"}'>Final pricing</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44347}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'>2021. 5. 31</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Stockholder subscription"}'>Stockholder subscription</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44350}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'>2021. 6. 3</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Public subscription"}'>Public subscription</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44355}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'>2021. 6. 8</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Payment"}'>Payment</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44358}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'>2021. 6. 11</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Listing"}'>Listing</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44370}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'>2021. 6. 23</td>
</tr>
<tr><td colspan="2" rowspan="1" data-sheets-value='{"1":2,"2":"Source: DART"}'>Source: DART</td></tr>
</tbody>
</table><table class="table table-striped">
<colgroup>
<col width="350">
<col width="350">
</colgroup>
<tbody>
<tr><td colspan="2" rowspan="1" data-sheets-value='{"1":2,"2":"Pricing"}'>Pricing</td></tr>
<tr>
<td data-sheets-value='{"1":2,"2":"1st round"}'>1st round</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"RP × (1 - 15%) / [1 + (71.39% × 15%)]"}' data-sheets-formula='="RP × (1 - "&amp;(R[11]C[0]*100&amp;"%")&amp;") / [1 + ("&amp;(R[12]C[0]*100&amp;"%"&amp;" × "&amp;(R[11]C[0]*100&amp;"%"&amp;")]"))'>RP × (1 - 15%) / [1 + (71.39% × 15%)]</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Reference price (RP)"}'>- Reference price (RP)</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Min [Close, Avg (Close, 1W VWAP, 1M VWAP)]"}'>Min [Close, Avg (Close, 1W VWAP, 1M VWAP)]</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Reference date"}'>- Reference date</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44305}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}' data-sheets-formula="=Terms!R[41]C[0]">2021. 4. 19</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Ex-rights base price"}'>Ex-rights base price</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"[RP + (1st × 71.39%)] / (1 + 71.39%)"}' data-sheets-formula='="[RP + (1st × "&amp;R[9]C[0]*100&amp;"%"&amp;")] / (1 + "&amp;R[9]C[0]*100&amp;"%"&amp;")"'>[RP + (1st × 71.39%)] / (1 + 71.39%)</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Reference price (RP)"}'>- Reference price (RP)</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Previous close"}'>Previous close</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Reference date"}'>- Reference date</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44307}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}' data-sheets-formula="=Terms!R[39]C[0]">2021. 4. 21</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"2nd round"}'>2nd round</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"RP × (1 - 15%)"}' data-sheets-formula='="RP × (1 - "&amp;(R[5]C[0]*100&amp;"%")&amp;")"'>RP × (1 - 15%)</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Reference price (RP)"}'>- Reference price (RP)</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Min [Close, Avg (Close, 1W VWAP)]"}'>Min [Close, Avg (Close, 1W VWAP)]</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Reference date"}'>- Reference date</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44347}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}' data-sheets-formula="=Terms!R[40]C[0]">2021. 5. 31</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Final"}'>Final</td>
<td style="text-align: right;" data-sheets-value='{"1":2,"2":"Max [Min (1st, 2nd), 3D VWAP × 60%]"}'>Max [Min (1st, 2nd), 3D VWAP × 60%]</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - Reference date"}'>- Reference date</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44347}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}' data-sheets-formula="=Terms!R[38]C[0]">2021. 5. 31</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Discount rate"}'>Discount rate</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.15}' data-sheets-numberformat='[null,3,"0.00%",1]'>15.00%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Capital increase rate"}'>Capital increase rate</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.7139}' data-sheets-numberformat='[null,3,"0.00%",1]' data-sheets-formula="=LEFT(Terms!R[11]C[0],6)*100/100">71.39%</td>
</tr>
<tr><td colspan="2" rowspan="1" data-sheets-value='{"1":2,"2":"Source: DART"}'>Source: DART</td></tr>
</tbody>
</table>

Hanwha Systems announced a ₩1.2T rights offer at a 71.39% capital increase rate.Per-share allocation for stockholders is 0.58124 as 20% goes to the ESOP.The pricing discount is 15%, a little more aggressive than the usual 20%.The ex-rights fall on April 21, with the preliminary pricing on April 19. The final pricing will be out on May 31. You can trade subscription rights between May 13~20.





Overview

Issuer
Hanwha Systems Co Ltd


Ticker
272210


Target
A public offering of forfeited shares after offering to stockholders


Transferability
Renounceable


Volume
78,689,000


Bonus issue volume
0


Preliminary price
₩15,250


Preliminary value
₩1,200,007,250,000


Oversubscription privilege
20.00%


Banker
Daishin &amp; KIS


- Underwriting type
Standby

Source: DART







Allocation

Common
110,230,389


Pref (incl. RCPS &amp; CPS)
0


Total shares
110,230,389


Treasury shares
1,926,128


Total shares ex treasury shares
108,304,261


Offer volume
78,689,000


- Common
78,689,000


- Pref
0


Per-share allocation
0.5812440


Capital increase
71.39%


Dilution
41.65%


Total shares after rights offer
188,919,389


- Common
188,919,389


- Pref
0


Bonus issue
0


- Common
0


- Pref
0


Per-share allocation
0.0000000


Total shares after bonus issue
188,919,389


- Common
188,919,389


- Pref
0


ESOP allocation
15,737,800


- %
20.00%


Stockholder allocation
62,951,200


- %
80.00%

Source: DART







Timetable

BOD meeting
2021. 3. 29


Preliminary pricing
2021. 4. 19


Ex-rights date
2021. 4. 21


Record date
2021. 4. 22


Subscription rights trade beginning
2021. 5. 13


Subscription rights trade ending
2021. 5. 20


Final pricing
2021. 5. 31


Stockholder subscription
2021. 6. 3


Public subscription
2021. 6. 8


Payment
2021. 6. 11


Listing
2021. 6. 23

Source: DART







Pricing

1st round
RP × (1 - 15%) / [1 + (71.39% × 15%)]


- Reference price (RP)
Min [Close, Avg (Close, 1W VWAP, 1M VWAP)]


- Reference date
2021. 4. 19


Ex-rights base price
[RP + (1st × 71.39%)] / (1 + 71.39%)


- Reference price (RP)
Previous close


- Reference date
2021. 4. 21


2nd round
RP × (1 - 15%)


- Reference price (RP)
Min [Close, Avg (Close, 1W VWAP)]


- Reference date
2021. 5. 31


Final
Max [Min (1st, 2nd), 3D VWAP × 60%]


- Reference date
2021. 5. 31


Discount rate
15.00%


Capital increase rate
71.39%

Source: DART



Hanwha Systems ₩1.2T Rights Offer Summary & Dynamics

South Korea

Hanwha Systems Co., Ltd. designs, develops, and distributes high-tech systems for the defense industry. The Company manufactures tactical communication systems, radar systems, naval combat systems, electro-optics, and fire control systems. Hanwha Systems markets its products throughout South Korea.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
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Hanwha Systems Co Ltd (272210 KS)

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