This article was published on Jan. 24, 2025, at 5:06 p.m. on the ChosunBiz MoneyMove site.
Lee Jae-woong, the founder of the car-sharing company SOCAR, has increased his stake to 10%. He converted his SOCAR shares, previously held through a venture fund, into personal equity. This was a change from ownership through the fund to his personal name. Lee has been steadily increasing his equity in SOCAR in preparation for any potential management dispute with LOTTE Rental.
According to the investment banking (IB) sector on the 24th, Lee has recently increased his holding in SOCAR to 9.99%. After continuously purchasing on the stock market last year to secure a 9% equity, he received a physical distribution of shares he held through the venture capital (VC) Yellow Dog Venture Fund.
Lee received approximately 69% of the total of 419,900 SOCAR shares that were held by the 'Yellow Dog Walk Investment Association,' amounting to 288,723 shares. The remaining 131,177 shares were distributed to the fund management company Yellow Dog (130,757 shares) and SOCAR's largest shareholder, SQC&I (420 shares).
Yellow Dog established the Yellow Dog Walk Investment Association in 2021 after receiving investments from Lee, and invested in SOCAR. At that time, the acquisition price per SOCAR share was reportedly 26,300 won. Considering the current SOCAR stock price of 16,350 won (based on the close on the 24th), it is assessed as an investment loss.
It is analyzed that Lee opted for a physical distribution rather than liquidating at a low price while accumulating SOCAR shares. Lee has been purchasing SOCAR shares for over a year, from Nov. 2023 to Dec. last year. He has also conducted two stock purchases this year alone.
Lee's share purchases are interpreted as a defense for SOCAR's management rights. This is because in March 2022, LOTTE Rental, having become a major shareholder of SOCAR, acquired 5,872,450 shares (17.9%) held by SK, which was the second-largest shareholder of SOCAR, thus ascending to the position of second-largest shareholder with a 34.68% equity.
Additionally, the private equity fund (PEF) management company Affinity's move to acquire LOTTE Rental's management rights has sparked an increase in Lee's equity accumulation. The market speculates that Affinity is planning to acquire SOCAR shares and merge with LOTTE Rental's car-sharing company, G Car.
Currently, even if a management dispute arises, it is assessed that Lee Jae-woong would be at an advantage. This is due to his existing ownership of more than 25% equity through his personal companies, SQC&I and SPOONG. Adding his personal equity would elevate his total ownership to 35.31%.
In addition, Lee is strengthening his governance by securing allies. Last year, he already signed a co-management agreement with Altos Ventures and brought in Park Jae-wook, the SOCAR CEO, along with his 'Bravo V Partners,' 'Povos,' and Kim Dong-hyun, the representative of SOCAR subsidiary MODU Company as allies.