Former President Yoon Suk-yeol's impeachment and the transition to a caretaker election phase are expected to delay the resale process of HMM. The increased equity stakes of HMM's major shareholders, the Industrial Bank of Korea and the Korea Maritime Promotion Corporation, also raise concerns about a higher sale price.
According to the shipping industry on the 9th, HMM is considering a plan to buy back 2 trillion won worth of its own shares within the year. This is part of a corporate value enhancement plan announced last year, but it is also related to the preparation for the sale. Since treasury stocks do not have voting rights, having a large number of treasury stocks means that a buyer can acquire fewer equities while still gaining higher voting power.
As of the end of last year, the Industrial Bank of Korea and the Korea Maritime Promotion Corporation hold equity stakes of 33.73% and 33.32%, respectively, in HMM. HMM plans to redeem the convertible bonds held by the Industrial Bank and the Korea Maritime Promotion Corporation, and if redeemed in stocks, their equity stakes will increase to 36.02% and 35.67%, respectively. Considering HMM's current market capitalization, the value of the stakes held by the Industrial Bank and the Korea Maritime Promotion Corporation amounts to approximately 11.3 trillion won.
Previously, Harim Group attempted to acquire 57.9% of the equity for 6.4 trillion won, but the deal fell through. Based on the current stock price, the market price for that 57.9% is about 9.2 trillion won, which is approximately 2.8 trillion won more than expected. Therefore, there are discussions about HMM potentially buying some of the major shareholder's equity to alleviate the burden on the buyers. HMM, which announced plans for stock buyback at the end of last year, has yet to decide on the timing and method.
As the country transitions into a caretaker election phase, forecasts suggest that the sale timeline will be delayed. Kang Seok-hoon's term as chairman of the Industrial Bank ends in June, and the Minister of Oceans and Fisheries, which oversees the Korea Maritime Promotion Corporation, is likely to change depending on the election results. The Industrial Bank has actively pursued the sale of HMM due to concerns over capital adequacy, including a decline in its capital adequacy ratio.
A shipping industry insider noted, "It will take considerable time to establish leadership at the Industrial Bank and the Korea Maritime Promotion Corporation and complete the stock buyback, and it is likely that the resell could only be pursued in the first half of next year at the earliest."