Integration of Korea Paper Investment Business Division... Haesung Industry Merges

[Asia Economy Reporter Kim Daeseop] Haesung Industry will merge with Hankuk Paper on July 1 this year. The subsidiary stocks held by Hankuk Paper (Gyeyang Electric, Haesung DS, Seha, Woonchang Packaging Industry, Hankuk Package) are all expected to be integrated into Haesung Industry.

Haesung Industry and Hankuk Paper held board meetings on the 1st and approved the merger agenda. A shareholders' meeting related to the merger is scheduled to be held on the 27th of next month.

Haesung Industry was established in 1954 and operates mainly in real estate leasing and development. Hankuk Paper, established in 1958, is a comprehensive paper company conducting business mainly in the domestic printing paper sector.

The two companies have operated in independent sectors while serving as an intermediate holding company owning shares of various affiliates within the Haesung Group. Due to the steady business expansion of companies within the group, the shareholding structure among affiliates has become much more complex than in the past. Since the unique business divisions and investment business divisions of each corporation are mixed, the possibility of risk transfer among affiliates has been continuously raised.

Accordingly, Haesung Industry, the parent company within the Haesung Group, will act as the merger entity to integrate Hankuk Paper's investment business division. Through subsequent restructuring of governance and business structure, various methods including conversion to a holding company will be used to improve governance.

The merger of the two companies aims not for short-term synergy effects but to strengthen the transparency of the group's governance in the long term and secure appropriate control over affiliates within the group, thereby enhancing the corporate value of all affiliates. It is also intended to establish an independent management system by business division through subsequent governance and business structure reorganization.

A Haesung Group official said, "Separating the unique business division and investment business division will strengthen responsible management by business division," adding, "Ultimately, it will enhance corporate and shareholder value and reduce unnecessary duplicate costs through integrated management of investment businesses."

He continued, "Since the merger aims to integrate the investment business division, there will be no changes to each company's brand, tangible and intangible business organizations, or main businesses. We will continue to review ways to create synergy with affiliates within the group so that the corporate and shareholder value of both companies can be increased through the merger."

This content was produced with the assistance of AI translation services.