In today’s briefing:
- The Latest on the Rumors Surrounding the Death of Chung Mong-Koo of Hyundai Motor Group
- Another Block Deal Sale of Ecopro Materials
- Shift Up IPO – Refiling and Other Updates, Not Ranked at the Top Anymore
- Clarifying BRV’s Post-Block Deal Lockup Conditions Involving Ecopro Materials
- Webtoon Entertainment Pre-IPO – Peer Comparison – Relatively Small in Operating Scale as a Platform
- Block Deal Sale of 3.6% Shares of Enchem
- Enchem Placement- Easily Digestible but a Punt at Best
The Latest on the Rumors Surrounding the Death of Chung Mong-Koo of Hyundai Motor Group
- Early this morning, rumors spread that Hyundai’s honorary chairman Chung Mong-koo was hospitalized and died, causing stock prices to surge, but Hyundai denied this news.
- Control of Hyundai hinges on increasing the stake in Mobis. Chung Eui-sun aims to keep Mobis’s stock low, but Chung Mong-koo’s health complicates timing and strategy.
- Mobis’s trading point depends on Chung Mong-koo’s health. Three scenarios: he’s healthy, critically ill, or deceased. Current rumors’ price impacts are unlikely to subside soon.
Another Block Deal Sale of Ecopro Materials
- Shares of EcoPro Materials are down 16% today to 112,300 won, due to another block deal sale of by BRV Capital in the after hours trading on 13 June.
- After the second block deal sale on 14 June, BRV’s stake declined further from 21.2% to 18.2%.
- This block deal sale at a big discount is likely to raise overhang concerns about further block deal sales by BRV Capital in the coming months/years.
Shift Up IPO – Refiling and Other Updates, Not Ranked at the Top Anymore
- Shift Up (462870 KS) plans to raise up to US$320m in its South Korean IPO.
- Shift Up is a South Korean games developer, which as released three games so far for the global markets.
- We have looked at the company’s performance, undertaken a peer comparison and talked about valuations in our past notes. In this note, we talk about the refiling and other updates.
Clarifying BRV’s Post-Block Deal Lockup Conditions Involving Ecopro Materials
- In Korea, the lockup period for block deals is set by the seller and underwriters, not by law, and can be adjusted if both parties agree.
- BRV obtained consent from Goldman, UBS, and KB for a second block deal after assessing that many initial buyers had sold their shares.
- Understanding this lockup structure provides key insights into predicting when the next block deal might occur.
Webtoon Entertainment Pre-IPO – Peer Comparison – Relatively Small in Operating Scale as a Platform
- Webtoon Entertainment (WBTN US) is looking to raise up to US$500m in its US IPO.
- Webtoon Entertainment is a global storytelling platform where a community of creators and users discover, create and share new content.
- In our previous note, we talked about the company’s historical performance. In this note, we undertake a peer comparison.
Block Deal Sale of 3.6% Shares of Enchem
- After the market close on 14 June, it was reported that Woori PE/other investors will be selling 705,384 shares of Enchem in a block deal, representing 3.6% of outstanding shares.
- The block deal discount rate ranges from 6.9% to 8.92%, resulting in potential block deal sale price of 270,500 won to 276,500 won.
- We would not subscribe to this block deal and we are concerned about the valuations of Enchem after a sharp share price appreciation this year.
Enchem Placement- Easily Digestible but a Punt at Best
- Woori PE, NH PE and KDB Capital seek to raise around KRW195bn (US$141m) through a secondary block deal, selling 0.71m shares (3.64% of TSO) of Enchem (348370 KS).
- The deal is a small one to digest at only 1.1 days of three-month ADV.
- In this note, we will talk about the placement and run the deal through our ECM framework.
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