From BigGo Finance · BigGo Finance · · 1m 40s
Hanmi Science Chairman Faces Tender Offer Rule Violation
Shin Dong-guk's off-exchange share purchases may violate South Korea's Capital Markets Act, risking voting rights and disposal orders.
In brief
Shin Dong-guk's off-exchange share purchases may violate South Korea's Capital Markets Act, risking voting rights and disposal orders. Hanmi Science chairman Shin Dong-guk faces potential Capital Markets Act violations from off-exchange share purchases, which could lead to voting rights restrictions and forced share…
Shin Dong-guk Faces Rule Scrutiny
Shin Dong-guk, chairman of Hanyang Precision and largest individual shareholder of Hanmi Science, faces potential violations of South Korea's Capital Markets Act.
Off-Exchange Purchases Triggered Rule Concerns
His off-exchange share purchases in February and July totaled 9,397,663 shares (13.74%) of Hanmi Science, exceeding 10 sellers.
Rule Violation Threshold Met
The July transaction occurred before six months had elapsed from the February deal, potentially triggering the Capital Markets Act's 10-seller threshold.
Voting Rights and Disposal Orders
If confirmed, voting rights on affected shares would be restricted and South Korea's Financial Services Commission could issue a disposal order.
Stock-Backed Loans at Risk
Shin holds 432.2 billion won (approximately $321.4 million) in stock-backed loans, raising concerns about margin calls and share price declines.
Refinancing Process
Shin refinanced loans through Hana Securities and Korea Securities Finance Corporation after his NH Investment & Securities loan expired.
Collateral Maintenance Ratio
The collateral maintenance ratio for Hana Securities was set at 200%, potentially risking margin calls if stock price drops.
Potential Disposal Order Impact
Forced sales could trigger share price declines, margin calls, and financial strain on Shin personally.
Market Reaction
Market analysts warn of margin calls and forced liquidation risks if stock price declines due to disposal orders.
The takeaway
Hanmi Science chairman Shin Dong-guk faces potential Capital Markets Act violations from off-exchange share purchases, which could lead to voting rights restrictions and forced share sales.
