Suncheonman Garden Market Co., Ltd., Citizen Shareholders' Subscription Disappointed by Stock Allocation

Difference in subscription amount exceeding 100 times is for investor recruitment, not citizen shareholders
279 citizen shareholders in the 100,000 KRW range, totaling 62.3 million KRW, accounting for only 6% of the total

[Suncheon=Asia Economy Honam Reporting Headquarters Reporter Lee Hyung-kwon] Suncheonman Garden Market Co., Ltd. is planning to operate a garden tree wholesale market and a comprehensive exhibition and sales center for garden materials being constructed in the Yeonhyangddeul area. Suncheon City is investing 1 billion KRW, and private shareholders are raising 1.01 billion KRW through a public offering, establishing the company as an agricultural corporation with a capital of 2.01 billion KRW.

Suncheonman Garden Market Co., Ltd. announced on the 28th on the city’s website that the subscription rate for private shareholders reached 181%.

The subscription amounts for private shareholders ranged from a minimum of 100,000 KRW to a maximum of 10 million KRW, a difference of over 100 times, raising concerns among some about whether this aligns with the purpose of recruiting citizen shareholders.

Citizen A said, “If the intention is to involve citizens as shareholders, the 100-fold difference in subscription amounts is an incomprehensible administrative action,” adding, “Those who can subscribe for 10 million KRW are clearly stakeholders or specific individuals. It seems unfair.”

In response, a representative of the corporate preparation committee said, “Regarding shareholder recruitment, we complied with laws and procedures as stipulated by the Financial Supervisory Service and others,” and added, “Public subscription is an investment concept in a stock company,” giving an answer somewhat detached from public sentiment.

The stock allocation results prove that the phrase “recruiting citizen shareholders” has become meaningless.

Among the 1.01 billion KRW from citizen shareholders, 279 citizens who received stock allocations in the 100,000 KRW range accounted for a total of 62.3 million KRW, which is only about 6% of the total.

In contrast, 422 citizens and corporations who received stock allocations in the 1 million KRW range accounted for 938.6 million KRW.

Among the 422, 53 people, including six promoters who subscribed for stocks worth 5 million KRW, received high-value stock allocations. There were 49 citizens who appear to have subscribed for stocks in the 10 million KRW range, with the highest allocation reaching 19.2 million KRW.

This result overshadowed the general citizens who subscribed for stocks in the 100,000 KRW range, which was intended to promote the development of the garden industry.

As the preparation committee representative said, it has been criticized for turning into an investment in a general stock company.

Suncheon City had promoted the public offering of shares targeting citizens for the garden industry, but it ended up acting as an agent for recruiting shareholders of a general company, leading to criticism asking, “Who really owns Suncheonman Garden Market?”

Suncheon City boasted that the public offering for private shareholders raised a total of about 1.815 billion KRW from 685 subscribers, but compared to the local food corporation’s launch, which attracted 1,300 participants subscribing for stocks worth 500 million KRW, 685 subscribers for stocks worth 1 billion KRW is a modest result.

There are criticisms that it is problematic for the stock company established by six promoters, who have mainly worked in landscaping, to be entrusted with the facility leasing and operation rights of Suncheonman Garden Market, which involved an investment of 27 billion KRW, especially when Suncheon City invested 1 billion KRW and even promoted and recruited citizen shareholders.

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