Kyobo Life IPO 'Day of Destiny'... Chairman Shin Chang-jae to Take the Lead

[Asia Economy Reporter Park So-yeon] Kyobo Life Insurance is undergoing a preliminary listing review ahead of its initial public offering (IPO) on the Korea Exchange. Although the approval of the review is uncertain due to disputes among major shareholders, Chairman Shin Chang-jae will personally attend the Listing Disclosure Committee to present his statements for a positive outcome.

According to the financial investment industry on the 8th, the Korea Exchange will hold a Listing Disclosure Committee meeting on the same day to conduct the preliminary listing review of Kyobo Life Insurance and announce the results.

Chairman Shin Chang-jae’s side is expected to actively present opinions to the committee regarding the continuity of corporate management, management transparency, and management stability.

Despite disputes among major shareholders such as Affinity, it is anticipated that the major shareholder will express a strong will to meet the qualitative requirements of the listing review, including management stability.

The biggest issues in Kyobo Life Insurance’s preliminary listing review are management stability and investor protection. This is due to increased volatility in management rights amid disputes among major shareholders and concerns about insufficient investor protection.

Kyobo Life Insurance’s position is that since approval from financial authorities is required to become the company’s largest shareholder, there is no problem with investor protection.

An official from the investment banking industry said, "Even if an extreme situation occurs where the largest shareholder changes, investor protection is not an issue at all because approval from financial authorities is necessary to become Kyobo Life Insurance’s largest shareholder."

He added, "With a capital base of around 10 trillion won, only foreigners, large corporations, or financial holding companies can aim to become the largest shareholder of a large company. Foreigners and large corporations are filtered out during the financial authorities’ approval process, leaving only major financial holding companies. I do not believe there are concerns about financial holding companies being insufficient in investor protection. There will be no problem even if the company goes public."

Currently, Chairman Shin Chang-jae and related parties hold a 36.9% stake as the largest shareholders of Kyobo Life Insurance. Through the IPO, Kyobo Life plans to diversify capital-raising methods in preparation for the new accounting standards (IFRS17) effective from 2023 and aim to transition into a financial holding company.

Previously, Kyobo Life officially announced its IPO plans in the second half of 2018. However, international arbitration between Chairman Shin and major shareholders such as Affinity has continued for a long time, causing the IPO to remain stalled.

Kyobo Life stated, "If the IPO is successfully carried out, disputes among shareholders will naturally be resolved. Since the root of the dispute was the fair market value (FMV), the IPO can produce the most rational and transparent FMV."

They added, "Affinity, fearing the rational FMV produced through the IPO, is continuing legal disputes to obstruct the IPO."

On the other hand, Affinity claims that the preliminary listing review was requested to invalidate the exercise of the put option.

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