Samkwang Glass to Apply 10% Premium on Standard Market Price Amid Merger Ratio Controversy

[Asia Economy Reporter Moon Hyewon] Samkwang Glass announced on the 20th that it has decided to change the merger ratio in the process of merging its affiliates.

This decision follows a 10% upward adjustment of Samkwang Glass's merger price from the previous 26,460 KRW to 29,106 KRW.

Accordingly, the merger ratio between Samkwang Glass and Gunjang Energy has changed from the previous 1 to 2.54 to 1 to 2.14. The merger ratio between Samkwang Glass and the investment division of E-Tech Construction was also adjusted from 1 to 3.88 to 1 to 3.22.

Samkwang Glass explained, "Considering the stock price decline due to the impact of the novel coronavirus infection (COVID-19), a 10% premium was applied to the standard market price, which serves as the basis for the merger price."

Earlier, some minority shareholders opposed, claiming that Samkwang Glass's corporate value was relatively undervalued and raised suspicions that this merger might be intended for the succession of second-generation management. Lee Wonjun and Lee Woosung, sons of Chairman Lee Bokyoung, hold shares in Gunjang Energy and E-Tech Construction respectively, and it is argued that if this merger proceeds, they could significantly increase their stake in Samkwang Glass.

The company stated, "This adjustment of the merger ratio reflects unforeseen factors such as the prolonged COVID-19 pandemic within legally permissible limits," adding, "Through the merger ratio adjustment, the scale of new shares issued for the merger will be significantly reduced, which is expected to have a positive effect on the stock price."

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