In early trading on the 22nd, STX Green Logis is plunging 11%. The drop appears to be due to a notice of designation as an unfaithful disclosure company after it delayed disclosing a debt guarantee exceeding 1,200% of its equity capital.
As of 9:50 a.m. that day on the Korea Exchange, STX Green Logis is trading at 5,280 won, down 710 won (11.85%) from the previous session.
Earlier, the Korea Exchange (KRX) gave prior notice that it would designate STX Green Logis as an unfaithful disclosure company. The reason was that it failed to disclose in a timely manner the "decision to provide a debt guarantee for another party."
STX Green Logis provided a debt guarantee worth 185.7 billion won for STX, a related party of the largest shareholder, on borrowing fund from Nov. 29, 2023, to Nov. 30, 2024. This amounted to about 1,211% of its equity capital at the time.
The company was newly established on Sept. 1, 2023, through a spin-off from STX Co., Ltd., and explained that, under the Commercial Act, it shares joint and several repayment liability with the surviving split company, STX Co., Ltd., for debts incurred before the partitioning.
Although the period of the large-scale debt guarantee has ended, the roughly three-year delay in disclosure appears to have damaged investor sentiment.