CJ's stock surged on the afternoon of the 14th. The news that CJ Olive Young would early acquire the equity held by financial investors (FI) after one year appears to have stimulated investor sentiment.
CJ's stock was traded at 125,500 won in the KOSPI market at 3:15 p.m. on the 14th. The stock rose by 14.82% (16,200 won) compared to the previous day. During trading, the stock even jumped to 134,400 won.
According to industry sources, CJ Olive Young has decided to reacquire the equity held by Korea Beauty Pioneer. Korea Beauty Pioneer is a special purpose company (SPC) created by Shinhan Investment Corp. and Shinhan Bank. In March of last year, half of CJ Olive Young's equity, previously held by Glenwood Private Equity (PE), was acquired as treasury stock, while the other half was acquired by Korea Beauty Pioneer.
At that time, CJ Olive Young held the right (call option) to purchase the equity of Korea Beauty Pioneer. The exercise period was up to three years, but it was decided to exercise the call option after one year.
CJ Olive Young's equity is held as follows: CJ holds 51.15%, treasury stock 11.29%, Lee Sun-ho, head of CJ CheilJedang's food growth promotion office, 11.04%, and Lee Kyung-hoo, head of brand strategy at CJ ENM, 4.21%, totaling to 88.11% by related parties. If CJ Olive Young re-acquires 11.29%, the holdings by related parties will approach 100%, further strengthening their dominance.