Hyundai G.F Holdings and Hyundai Home Shopping will carry out a comprehensive stock exchange. As a result, the delisting of Hyundai Home Shopping will be pursued. Hyundai G.F Holdings disclosed this on the 11th.
With the stock exchange, the shares of the company owned by Hyundai Home Shopping shareholders will transfer to Hyundai G.F Holdings. In return, for each share of Hyundai Home Shopping common stock, 6.3571040 shares of Hyundai G.F Holdings common stock will be exchanged and paid. The shareholders meeting will be held on Apr. 20. The scheduled date for the stock exchange is June 30.
Shareholders who oppose can exercise their appraisal rights. The claim price, set in accordance with relevant laws and regulations, is 9,383 won for Hyundai G.F Holdings and 60,709 won for Hyundai Home Shopping.
Under this stock exchange decision, Hyundai Home Shopping is set to be partitioned into an investment company and an operating company. If carried out as planned, the newly established investment company will hold Handsome, Hyundai Futurenet, and Hyundai L&C. The operating company will focus on the core home shopping business and actively pursue new businesses and mergers and acquisitions (M&A). The newly established investment company will later go through a step to merge with Hyundai G.F Holdings.
Hyundai Department Store Group said of this comprehensive stock exchange decision, "The business environment surrounding the core home shopping business has worsened, unlike in the past, and there were limits to boosting corporate value in the process of serving as an intermediate holding company in terms of governance." It added, "After Hyundai Home Shopping is incorporated as a wholly owned subsidiary of Hyundai G.F Holdings, we determined that shifting to a structure where each segment can focus on its core strengths through a spin-off of the business and investment segments could contribute to Hyundai Home Shopping's long-term growth and mid- to long-term enhancement of corporate value."
With this stock exchange, Hyundai Department Store Group will be able to resolve the "duplicate listings (a structure where a parent and subsidiary are listed at the same time)" of Hyundai Home Shopping, an intermediate holding company. From Hyundai G.F Holdings' perspective, simplifying the duplicate listing structure of major subsidiaries and second- and third-tier subsidiaries can reduce the holding company discount.
Treasury shares will also be canceled. A total of 10 companies are subject to this: Hyundai Department Store, Home Shopping, Green Food, Handsome, Livart, ZINUS, EZwel, Futurenet, Everdigm, and SAMWONSTEEL. When this is done, all 13 listed companies in Hyundai Department Store Group will no longer hold treasury shares. A decision was also made to buy back and cancel treasury shares. In the course of the comprehensive stock exchange, Hyundai G.F Holdings plans to buy back treasury shares worth a total of 100 billion won and cancel them in one batch within the year to maximize the interests of Hyundai G.F Holdings and existing Hyundai Home Shopping shareholders.
A Hyundai Department Store Group official said, "The scale of canceling newly purchased treasury shares and existing treasury shares is roughly 350 billion won." Canceling treasury shares is a representative shareholder return policy that refers to canceling treasury shares the company holds or has secured through purchases to reduce the number of shares in circulation. When the total number of shares decreases, the value of the existing shares held by shareholders rises, which typically acts as a positive for the stock price.
A Hyundai Department Store Group official said, "This decision reflects the group's strong commitment to proactively respond to government policy and social demands to enhance corporate value through canceling treasury shares, and to become a company that grows with shareholders through active shareholder return policies," adding, "We will continue to gather various market opinions and prepare forward-looking, shareholder-friendly policies."
Meanwhile, in the securities industry, there is a view that the trend of corporate governance reorganization has been carried out in an exemplary manner. An official at a securities firm said, "Starting with the holding company, the governance restructuring is being carried out succinctly," adding, "In addition to eliminating the debate over duplicate listings, canceling all treasury shares held or newly acquiring treasury shares and canceling them would not have been an easy decision."