Fourteen companies listed on the Korean securities market and 43 companies listed on KOSDAQ are facing delisting risks.
The Korea Exchange announced on the 9th the status of market measures regarding the 'settlement of account for fiscal year 2024' for listed companies on the Korean securities and KOSDAQ markets.
As a result of this settlement of account, 14 firms faced reasons for delisting on the Korean securities market, while 4 companies were newly designated as managed stocks, and 3 were lifted from designation.
Among the 14 companies facing delisting due to insufficient audit opinions, Kumyang, BUMYANG CONSTRUCTION, SAMBU Construction, STAR SM REIT, ENPLUS, KC GreenHoldings, and KC Cottrell have newly encountered reasons for delisting this time. KUKBO, Well Biotec, Hanchang, and EID received 'denied' opinions for two consecutive years, and iHQ, KH Feelux, and SEWON E&C received 'denied' opinions for three consecutive years.
Companies that were the first to receive denied audit opinions can file objections within 15 days from the notification date of delisting, and the exchange will decide whether to grant a remedy period upon receiving the objection. Companies that have had relevant reasons for two consecutive years will decide on delisting after consultation with the listing disclosure committee when the remedy period ends on the 14th of this month.
BUMYANG CONSTRUCTION, STAR SM REIT, and ENPLUS have been newly designated as managed stocks, while Dynamic Design has become a managed stock with limited scope of audit. Existing managed stocks, AREITS, TAEYOUNG E&C, and INBIOGEN have been removed from managed status.
Among KOSDAQ-listed companies, those facing delisting reasons last year due to insufficient audit opinions totaled 43, including EOFlow, Jeil M&S, and TOBESOFT. The first reasons arose for 19 companies, while 20 firms received denied opinions for two consecutive years, and 4 faced this for three consecutive years. Compared to the previous year, there was a decrease of 12 companies in the new cases of insufficient audit opinions (31 companies to 19 companies).
KOSDAQ-listed companies that were the first to receive 'denied' audit opinions will also accept objections from the listed corporations within 15 business days from the notification date of delisting, similar to the Korean securities market. If an objection is lodged, a remedy period will be granted from the day after the legal submission deadline for the next business report for 10 days.
Corporations with insufficient audit opinions for two consecutive years will undergo deliberation and resolution by the corporate review committee this year to determine whether to delist. For companies with insufficient audit opinions for three years or more, delisting has already been decided, and there are no separate procedures for delisting.
Among KOSDAQ-listed companies, 28 were newly designated as managed stocks, while 6 were delisted. A spokesperson from the exchange noted, 'The number of companies facing reasons for large losses has increased, resulting in 8 more new designations compared to the previous year, while the number of delistings rose by 2.'
A total of 31 companies were newly designated as precautionary investment items, and 31 were removed from the designation. The occurrence of inappropriate internal accounting management reasons decreased, resulting in a drop from 35 new designations to 31, while delistings increased from 26 to 31.