Coupang Chooses US Stock Market... Maintains Kim Beom-seok's Leadership with 'Differential Voting Rights'

Securing 29 Votes Per Share
Likely to Exercise Stable Management Rights
Announces Plans to Expand Investment and Employment

Beom-seok Kim, Chairman of the Board at Coupang

[Asia Economy Reporter Kim Bo-kyung] Coupang, the strongest player in the online shopping mall industry, chose to list on the U.S. New York Stock Exchange instead of the domestic stock market. The background of going to the U.S. stock market lies in the 'dual-class voting rights' granted to Coupang founder and Chairman of the Board Kim Beom-seok. Chairman Kim is expected to expand investment and employment based on strong management rights.

According to the listing application documents submitted to the U.S. Securities and Exchange Commission (SEC) on the 12th, Coupang granted dual-class voting rights to the Class B shares held by Chairman Kim, which are 29 times the voting rights of the general Class A shares.

Dual-class voting rights are a system designed to allow founders or managers to operate the company stably without threats to management control. This means that one share held by Chairman Kim has voting rights equivalent to 29 general shares held by others.

Recently, U.S. companies such as DoorDash, a food delivery startup, and Airbnb, a home-sharing company, which have gone public, also granted their co-founders dual-class voting rights 20 times greater than general shares. Unlike Korea, it is common in the U.S. to issue multiple classes of shares with differentiated voting rights.

Although the exact amount of Class B shares held by Chairman Kim has not been disclosed, it is expected that even with only 2% equity, he can exercise shareholder rights equivalent to 58%, allowing him to check external takeover (M&A) attempts and maintain stable management control. This is interpreted as one of the reasons Coupang chose to list on the U.S. stock market.

There are also opinions that it is difficult to meet the listing requirements of the domestic stock market, unlike the U.S., due to Coupang's continued deficits.

[Image source=Yonhap News]

Coupang is expected to continue aggressive investment by raising funds through listing on the U.S. stock market.

Logistics centers and fulfillment (an integrated logistics management system that oversees storage, packaging, delivery, and inventory management) expansion to expand the 'Rocket Delivery' service area are cited as major uses of funds.

In the listing application documents, Coupang stated, "A significant portion of our current expenditures is investment for future growth, and according to our ambitious growth plans, we expect to continue large-scale capital expenditures in the near future," adding, "We aim to expand service areas by building fulfillment centers and logistics centers, while reducing delivery times and optimizing cost structures."

Coupang explained that it plans to expand its overall direct purchase product categories, including major product groups with low market penetration such as home appliances, beauty, and clothing, and to attract more sellers to register on Coupang.

Along with this, mentioning Rocket Fresh, Coupang Eats, and Coupang Pay, the company stated, "We are always exploring new business plans to expand our range of offerings," suggesting the possibility of expanding into new business areas.

It also stated, "We hired 25,000 people last year alone," and set a goal to hire 50,000 new employees by 2025.

Meanwhile, Coupang recorded sales of 13.25 trillion won last year due to the impact of the COVID-19 pandemic. This is nearly double the previous year's (7.1 trillion won) scale.

Chairman Kim received a total compensation of $1,434,122.9 (approximately 15.8 billion won), including an annual salary of $886,000 (about 980 million won) and stock-based bonuses last year. Chief Technology Officer Tuan Pham received a total compensation of about $27.64 million (approximately 30.5 billion won).

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