Theborn Korea, led by CEO Baek Jong-won, has reportedly earned approximately 9.1 billion won in local development projects centered on regional festivals and revitalizing local markets over the past three years.
According to the Financial Supervisory Service on the 26th, Theborn Korea disclosed in its 2024 business report that it recorded 9.1 billion won in sales through 80 local government projects in the regional development sector over the past three years. Sales steadily increased to 1 billion won in 2022, 2.9 billion won in 2023, and 5.2 billion won in 2024.
◇80 local government projects over 3 years, sales of 9.1 billion won
Theborn Korea is engaging in local development projects, including menu development for local units such as counties and cities, food service training, consulting for market operation methods, revitalization of festivals, and supplying food products. The projects are mainly carried out through service contracts with local governments.
Theborn Korea described its regional development efforts as "a business that contributes to local development based on expertise in the food service franchise business and brand operational know-how."
However, following its listing in November of last year, there were criticisms that CEO Baek and Theborn Korea were 'sweeping up' consulting services for local markets and festivals from local governments and its affiliated organizations. There are concerns that taxpayer money is being funneled to Baek and Theborn Korea. (☞Related article 6 billion won of public funds for a local festival... Baek Jong-won sweeps up dozens of local government projects)
In response, Baek explained on December 27 through his YouTube channel that "There are over 1,100 local festivals nationwide in 2024. Theborn Korea has conducted 14 projects over two years, so how can this be considered sweeping up?" He also noted, "If we earned 10 billion won in sales from local festivals, the stock price of our company should have skyrocketed, but that is not the case."
However, Baek's explanation was found to be inconsistent with the facts. According to data investigated by the private research institute Nara Salim Research Institute, there were 1,170 local festivals held nationwide last year, and among those, 113 key festivals received budgets exceeding 1 billion won. The business report disclosed by Theborn Korea indicates that last year, the company secured 18 local festival projects through MOU with local governments, which amounts to 16% of the nationwide major festivals (113).
The total number of local government projects conducted by Theborn Korea over the past three years, including service for local product development and market revitalization, reached 80. The sales recorded from regional development projects over the recent three years also reached 9.1 billion won, nearing 10 billion won.
◇Stock price fell 55% from its peak... First annual general meeting on the 28th attracts attention
The issue is that the service fees for local festivals conducted by Theborn Korea vary widely and lack standardized criteria. Theborn Korea received service fees of 300 million won for some festivals and 600 million won for others. Among local governments and their affiliated organizations operating local festivals, there have been claims of "we did it for cheaper."
It is also pointed out that many local development projects are being conducted in Baek's hometown, Yesan County. Over the past two years, Theborn Korea has secured eight local development projects from Yesan County and completed all of them.
These include the Yesan County Agricultural and Food Distribution Division (development of promotional dessert menu, March 2023), Yesan County Cultural Center (consulting and operation of food booth, October 2023), Yesan County Cultural Tourism Division (training of experiential instructors for the Whooper area and menu development, February 2024), Yesan County Festival Team (research on food development and revitalization for the 8th Yesan Market Three Kingdoms Festival, September 2024), Yesan County Innovation Strategy Team (event agency for Yesan Global Food Championship cooking competition, November 2024), among others.
Theborn Korea will hold its first annual general meeting following its listing on the 28th. It plans to report on auditing, sales, and internal accounting management operations, along with approving financial statements as key agenda items. As of 2:38 p.m. on the 26th, Theborn Korea's stock price was 28,900 won, down 55% from its peak (64,500 won) and down 15% from its initial offering price.
Attention is focused on whether Baek can capture the hearts of shareholders at the annual general meeting.