Toss Securities will launch its first share buyback since its inception, up to 200 billion won. The move is intended to give shareholders of the unlisted company a chance to cash out their holdings, and the purchased shares will be retired later.
According to the financial investment industry on the 31st, Toss Securities held an extraordinary shareholders meeting that day and approved a plan to acquire treasury shares over the counter up to a limit of 200 billion won. This is the first buyback since Toss Securities was launched in 2021.
The purchase price was set at 194,361 won per share based on the corporate value assessed by an external accounting firm. The company can buy up to 1,029,013 shares, about 3.7% of the total outstanding. The transaction date is Oct. 16.
The actual purchase size may vary depending on shareholder applications. Toss Securities plans to confirm willingness to sell treasury shares from all shareholders at the same price and terms. The largest shareholder, Viva Republica, is also included as a transaction counterparty. Viva Republica currently holds about 97% equity in Toss Securities.
The buyback focuses on offering liquidity opportunities to unlisted shareholders. Among minority shareholders of Toss Securities are many employees who came to own company shares through performance compensation and other means. Because the company has not conducted an initial public offering (IPO), ways for them to cash out their holdings have been limited.
Allowing the largest shareholder, Viva Republica, to participate on the same terms appears to be a transaction structure designed to offer the same sale opportunity to all shareholders rather than limiting it to specific ones.
The capacity for a buyback has grown alongside improved earnings. In the first half of this year, Toss Securities posted operating profit of 319.5 billion won and net profit of 236.8 billion won, the highest ever for a half-year. Total assets also exceeded 12 trillion won. The company said accumulated profits have increased distributable income, making a large treasury share purchase possible.
Toss Securities plans to retire the purchased treasury shares within one year after acquisition under procedures of the Commercial Act, rather than holding them for a long period.