 |
(Photo= Yonhap news) |
[Alpha Biz= Reporter Kim Jisun] Emart is moving forward with a tender offer for Shinsegae Construction, aiming for delisting.
According to the investment banking (IB) industry on the 29th, Emart will begin a tender offer for 2,120,661 common shares (27.33%) of Shinsegae Construction from the 30th of this month until the 29th of next month. Emart, which already holds a 70.46% stake in Shinsegae Construction, will buy up all the remaining shares excluding treasury shares (2.21%). The tender offer price is set at 18,300 KRW per share, a 14.02% premium over the closing price of 16,050 KRW on the 27th. The total amount for the tender offer is approximately 38.8 billion KRW, and Shinhan Investment & Securities is the lead manager.
Emart is expected to pursue a delisting of Shinsegae Construction promptly after the tender offer is completed. Shinsegae Construction has been struggling with poor performance for several years, recording an operating loss of 187.8 billion KRW last year due to rising construction costs and the real estate market slump. The worsening profitability of Shinsegae Construction has increased the financial burden on Emart, which recorded its first operating loss (-46.9 billion KRW) last year since its founding. Emart also implemented its first voluntary retirement program in March.
However, there is likely to be opposition from minority shareholders of Shinsegae Construction. Those who initially purchased shares at a higher price than the tender offer may incur investment losses. The 52-week high for Shinsegae Construction was 18,650 KRW, and in January 2021, the stock price even exceeded 60,000 KRW during intraday trading.
Alphabiz Reporter Kim Jisun(stockmk2020@alphabiz.co.kr)
