Korea / Special Situations, Clepsydra Capital

Sanghyun Park

Korea / Special Situations

Korea / Special Sits, Pairs, Index Rebalancing

Clepsydra Capital

Investigate special situations, pairs, and index rebalancing trades in Korea.

Event-Driven

<p>We now have the spinoff details, meaning that we can now reasonably estimate each spinoff company's valuation.</p><p>SK Investment is relatively easy to estimate as it is a pure holding company without any meaningful operating operation. At the usual 50% local holding company discount to NAV, SK Investment's valuation should be slightly higher than ₩12T.</p><table class="table table-striped">
<colgroup>
<col width="100">
<col width="100">
<col width="100">
<col width="100">
<col width="100">
</colgroup>
<tbody>
<tr>
<td style="width: 167.756px;" data-sheets-value='{"1":2,"2":"SK Investment NAV"}'>SK Investment NAV</td>
<td style="text-align: right; width: 114.545px;" data-sheets-value='{"1":2,"2":"Type"}'>Type</td>
<td style="text-align: right; width: 119.56px;" data-sheets-value='{"1":2,"2":"Stake %"}'>Stake %</td>
<td style="text-align: right; width: 111.534px;" data-sheets-value='{"1":2,"2":"Value"}'>Value</td>
<td style="text-align: right; width: 128.636px;" data-sheets-value='{"1":2,"2":"Note"}'>Note</td>
</tr>
<tr>
<td style="width: 167.756px;" data-sheets-value='{"1":2,"2":"SK Hynix Inc"}' data-sheets-formula='=googlefinance(R[0]C[1], "name")'>SK Hynix Inc</td>
<td style="text-align: right; width: 114.545px;" data-sheets-value='{"1":2,"2":"000660"}' data-sheets-formula='="000660"'>000660</td>
<td style="text-align: right; width: 119.56px;" data-sheets-value='{"1":3,"3":0.201}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>20.10%</td>
<td style="text-align: right; width: 111.534px;" data-sheets-value='{"1":3,"3":18510.552133672503}' data-sheets-numberformat='{"1":2,"2":"₩#,##0.0B","3":1}' data-sheets-formula='=googlefinance(R[0]C[-2], "shares")*googlefinance(R[0]C[-2], "price")/1000000000*R[0]C[-1]'><strong>₩18,510.6B</strong></td>
<td rowspan="4" style="text-align: right; width: 128.636px;" data-sheets-value='{"1":2,"2":"Market value"}' data-sheets-numberformat='{"1":2,"2":"₩#,##0.0B","3":1}'><div><strong>Market value at the current share price</strong></div></td>
</tr>
<tr>
<td style="width: 167.756px;" data-sheets-value='{"1":2,"2":"NanoenTek Inc"}' data-sheets-formula='=googlefinance(R[0]C[1], "name")'>NanoenTek Inc</td>
<td style="text-align: right; width: 114.545px;" data-sheets-value='{"1":2,"2":"039860"}' data-sheets-formula='="039860"'>039860</td>
<td style="text-align: right; width: 119.56px;" data-sheets-value='{"1":3,"3":0.284}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>28.40%</td>
<td style="text-align: right; width: 111.534px;" data-sheets-value='{"1":3,"3":60.1202392572}' data-sheets-numberformat='{"1":2,"2":"₩#,##0.0B","3":1}' data-sheets-formula='=googlefinance(R[0]C[-2], "shares")*googlefinance(R[0]C[-2], "price")/1000000000*R[0]C[-1]'><strong>₩60.1B</strong></td>
</tr>
<tr>
<td style="width: 167.756px;" data-sheets-value='{"1":2,"2":"Dream Us Co"}' data-sheets-formula='=googlefinance(R[0]C[1], "name")'>Dream Us Co</td>
<td style="text-align: right; width: 114.545px;" data-sheets-value='{"1":2,"2":"060570"}' data-sheets-formula='="060570"'>060570</td>
<td style="text-align: right; width: 119.56px;" data-sheets-value='{"1":3,"3":0.418}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>41.80%</td>
<td style="text-align: right; width: 111.534px;" data-sheets-value='{"1":3,"3":143.31751875738001}' data-sheets-numberformat='{"1":2,"2":"₩#,##0.0B","3":1}' data-sheets-formula='=googlefinance(R[0]C[-2], "shares")*googlefinance(R[0]C[-2], "price")/1000000000*R[0]C[-1]'><strong>₩143.3B</strong></td>
</tr>
<tr>
<td style="width: 167.756px;" data-sheets-value='{"1":2,"2":"Incross Co Ltd"}' data-sheets-formula='=googlefinance(R[0]C[1], "name")'>Incross Co Ltd</td>
<td style="text-align: right; width: 114.545px;" data-sheets-value='{"1":2,"2":"216050"}' data-sheets-formula='="216050"'>216050</td>
<td style="text-align: right; width: 119.56px;" data-sheets-value='{"1":3,"3":0.346}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>34.60%</td>
<td style="text-align: right; width: 111.534px;" data-sheets-value='{"1":3,"3":152.2054083732}' data-sheets-numberformat='{"1":2,"2":"₩#,##0.0B","3":1}' data-sheets-formula='=googlefinance(R[0]C[-2], "shares")*googlefinance(R[0]C[-2], "price")/1000000000*R[0]C[-1]'><strong>₩152.2B</strong></td>
</tr>
<tr><td colspan="5" style="width: 726.008px;"><div></div></td></tr>
<tr>
<td style="width: 167.756px;" data-sheets-value='{"1":2,"2":"11st Street"}'>11st Street</td>
<td style="text-align: right; width: 114.545px;" data-sheets-value='{"1":2,"2":"Unlisted"}'>Unlisted</td>
<td style="text-align: right; width: 119.56px;" data-sheets-value='{"1":3,"3":0.803}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>80.30%</td>
<td style="text-align: right; width: 111.534px;" data-sheets-value='{"1":3,"3":2208.25}' data-sheets-numberformat='{"1":2,"2":"₩#,##0.0B","3":1}' data-sheets-formula="=R[0]C[2]*R[0]C[-1]"><strong>₩2,208.3B</strong></td>
<td rowspan="5" style="text-align: right; width: 128.636px;" data-sheets-value='{"1":2,"2":"Based on the most recent private placement"}' data-sheets-numberformat='{"1":2,"2":"₩#,##0.0B","3":1}'><div><strong>Based on the most recent private placement</strong></div></td>
</tr>
<tr>
<td style="width: 167.756px;" data-sheets-value='{"1":2,"2":"T-Map Mobility"}'>T-Map Mobility</td>
<td style="text-align: right; width: 114.545px;" data-sheets-value='{"1":2,"2":"Unlisted"}'>Unlisted</td>
<td style="text-align: right; width: 119.56px;" data-sheets-value='{"1":3,"3":0.663}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>66.30%</td>
<td style="text-align: right; width: 111.534px;" data-sheets-value='{"1":3,"3":928.2}' data-sheets-numberformat='{"1":2,"2":"₩#,##0.0B","3":1}' data-sheets-formula="=R[0]C[2]*R[0]C[-1]"><strong>₩928.2B</strong></td>
</tr>
<tr>
<td style="width: 167.756px;" data-sheets-value='{"1":2,"2":"ADT Caps"}'>ADT Caps</td>
<td style="text-align: right; width: 114.545px;" data-sheets-value='{"1":2,"2":"Unlisted"}'>Unlisted</td>
<td style="text-align: right; width: 119.56px;" data-sheets-value='{"1":3,"3":0.626}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>62.60%</td>
<td style="text-align: right; width: 111.534px;" data-sheets-value='{"1":3,"3":813.8}' data-sheets-numberformat='{"1":2,"2":"₩#,##0.0B","3":1}' data-sheets-formula="=R[0]C[2]*R[0]C[-1]"><strong>₩813.8B</strong></td>
</tr>
<tr>
<td style="width: 167.756px;" data-sheets-value='{"1":2,"2":"Contents Wavve"}'>Contents Wavve</td>
<td style="text-align: right; width: 114.545px;" data-sheets-value='{"1":2,"2":"Unlisted"}'>Unlisted</td>
<td style="text-align: right; width: 119.56px;" data-sheets-value='{"1":3,"3":0.364}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>36.40%</td>
<td style="text-align: right; width: 111.534px;" data-sheets-value='{"1":3,"3":436.8}' data-sheets-numberformat='{"1":2,"2":"₩#,##0.0B","3":1}' data-sheets-formula="=R[0]C[2]*R[0]C[-1]"><strong>₩436.8B</strong></td>
</tr>
<tr>
<td style="width: 167.756px;" data-sheets-value='{"1":2,"2":"One Store"}'>One Store</td>
<td style="text-align: right; width: 114.545px;" data-sheets-value='{"1":2,"2":"Unlisted"}'>Unlisted</td>
<td style="text-align: right; width: 119.56px;" data-sheets-value='{"1":3,"3":0.475}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>47.50%</td>
<td style="text-align: right; width: 111.534px;" data-sheets-value='{"1":3,"3":427.5}' data-sheets-numberformat='{"1":2,"2":"₩#,##0.0B","3":1}' data-sheets-formula="=R[0]C[2]*R[0]C[-1]"><strong>₩427.5B</strong></td>
</tr>
<tr><td colspan="5" style="width: 726.008px;"><div></div></td></tr>
<tr>
<td style="width: 167.756px;" data-sheets-value='{"1":2,"2":"Others, including SK Planet"}'>Others, including SK Planet</td>
<td style="text-align: right; width: 114.545px;" data-sheets-value='{"1":2,"2":"Unlisted"}'>Unlisted</td>
<td style="text-align: right; width: 119.56px;" data-sheets-value='{"1":2,"2":"-"}'>-</td>
<td style="text-align: right; width: 111.534px;" data-sheets-value='{"1":3,"3":683.1}' data-sheets-numberformat='{"1":2,"2":"₩#,##0.0B","3":1}' data-sheets-formula="=60.3+100.5+94.1+5.6+17.8+404.8"><strong>₩683.1B</strong></td>
<td style="text-align: right; width: 128.636px;" data-sheets-value='{"1":2,"2":"Book value"}' data-sheets-numberformat='{"1":2,"2":"₩#,##0.0B","3":1}'><strong>Book value</strong></td>
</tr>
<tr>
<td style="width: 167.756px;" data-sheets-value='{"1":2,"2":"Net cash"}'><strong>Net cash</strong></td>
<td style="text-align: right; width: 114.545px;" data-sheets-value='{"1":2,"2":"-"}'><strong>-</strong></td>
<td style="text-align: right; width: 119.56px;" data-sheets-value='{"1":2,"2":"-"}'><strong>-</strong></td>
<td style="text-align: right; width: 111.534px;" data-sheets-value='{"1":3,"3":387.8}' data-sheets-numberformat='{"1":2,"2":"₩#,##0.0B","3":1}'><strong>₩387.8B</strong></td>
<td style="text-align: right; width: 128.636px;" data-sheets-value='{"1":2,"2":"-"}'><strong>-</strong></td>
</tr>
<tr>
<td style="width: 167.756px;" data-sheets-value='{"1":2,"2":"Total"}'>Total</td>
<td style="text-align: right; width: 114.545px;" data-sheets-value='{"1":2,"2":"-"}'>-</td>
<td style="text-align: right; width: 119.56px;" data-sheets-value='{"1":2,"2":"-"}'>-</td>
<td style="text-align: right; width: 111.534px;" data-sheets-value='{"1":3,"3":24751.64530006028}' data-sheets-numberformat='{"1":2,"2":"₩#,##0.0B","3":1}' data-sheets-formula="=sum(R[-11]C[0]:R[-1]C[0])"><strong>₩24,751.6B</strong></td>
<td style="text-align: right; width: 128.636px;" data-sheets-value='{"1":2,"2":"-"}'>-</td>
</tr>
<tr>
<td style="width: 167.756px;" data-sheets-value='{"1":2,"2":" - At a 50% discount to NAV"}'><strong>- At a 50% discount to NAV</strong></td>
<td style="text-align: right; width: 114.545px;" data-sheets-value='{"1":2,"2":"-"}'><strong>-</strong></td>
<td style="text-align: right; width: 119.56px;" data-sheets-value='{"1":2,"2":"-"}'><strong>-</strong></td>
<td style="text-align: right; width: 111.534px;" data-sheets-value='{"1":3,"3":12375.82265003014}' data-sheets-numberformat='{"1":2,"2":"₩#,##0.0B","3":1}' data-sheets-formula="=R[-1]C[0]*0.5"><strong>₩12,375.8B</strong></td>
<td style="text-align: right; width: 128.636px;" data-sheets-value='{"1":2,"2":"-"}'><strong>-</strong></td>
</tr>
<tr><td colspan="5" style="width: 726.008px;" data-sheets-value='{"1":2,"2":"Source: SK Telecom &amp; KRX"}'>Source: SK Telecom &amp; KRX</td></tr>
</tbody>
</table>

We now have the spinoff details, meaning that we can now reasonably estimate each spinoff company's valuation.SK Investment is relatively easy to estimate as it is a pure holding company without any meaningful operating operation. At the usual 50% local holding company discount to NAV, SK Investment's valuation should be slightly higher than ₩12T.









SK Investment NAV
Type
Stake %
Value
Note


SK Hynix Inc
000660
20.10%
₩18,510.6B
Market value at the current share price


NanoenTek Inc
039860
28.40%
₩60.1B


Dream Us Co
060570
41.80%
₩143.3B


Incross Co Ltd
216050
34.60%
₩152.2B



11st Street
Unlisted
80.30%
₩2,208.3B
Based on the most recent private placement


T-Map Mobility
Unlisted
66.30%
₩928.2B


ADT Caps
Unlisted
62.60%
₩813.8B


Contents Wavve
Unlisted
36.40%
₩436.8B


One Store
Unlisted
47.50%
₩427.5B



Others, including SK Planet
Unlisted
-
₩683.1B
Book value


Net cash
-
-
₩387.8B
-


Total
-
-
₩24,751.6B
-


- At a 50% discount to NAV
-
-
₩12,375.8B
-

Source: SK Telecom &amp; KRX



SK Telecom: Two Interpretations of Post-Spinoff Dividend Policy Creates a Huge Disparity

Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Korea/Asia, Events, IPOs

<p><a href="https://www.smartkarma.com/entities/sk-telecom-co-ltd-bbccd86c-474d-4a4d-946d-10e911a225a2" target="_blank" data-smartkarma-citation="entities:395:1" rel="noopener">SK Telecom (017670 KS)</a> announced the details of its reorganization plan today. SK Telecom will spin off a new investment company (tentatively named SKT Investment Co). SKT Investment will become the holding company of 16 companies including <a href="https://www.smartkarma.com/entities/sk-hynix-inc" target="_blank" data-smartkarma-citation="entities:16955:1" rel="noopener">SK Hynix (000660 KS)</a>, 11st, One Store, and T Map Mobility. According to the company, SKT Investment Co will actively pursue various M&amp;As in key sectors including semiconductor. It also plans to complete IPOs of numerous companies owned by the company. In 2021, it plans to IPO One Store. </p><p>With regards to the remaining SK Telecom, it will focus on its core telecom business as well s new technologies such as artificial intelligence, data centers, and metaverse-based services.</p><p>In this insight, we provide a detailed analysis of the expected dividend impact on the spun-off companies. </p>

SK Telecom (017670 KS) announced the details of its reorganization plan today. SK Telecom will spin off a new investment company (tentatively named SKT Investment Co). SKT Investment will become the holding company of 16 companies including SK Hynix (000660 KS), 11st, One Store, and T Map Mobility. According to the company, SKT Investment Co will actively pursue various M&amp;As in key sectors including semiconductor. It also plans to complete IPOs of numerous companies owned by the company. In 2021, it plans to IPO One Store. With regards to the remaining SK Telecom, it will focus on its core telecom business as well s new technologies such as artificial intelligence, data centers, and metaverse-based services.In this insight, we provide a detailed analysis of the expected dividend impact on the spun-off companies. 

SK Telecom: Details of Spin-Off Ratios & Expected Impact on Dividends

<p>This post details SK Telecom's spinoff announcement filed this morning. Please note that this post doesn't have an investment recommendation.</p><hr><h2>Equity spinoff</h2><p>SK Telecom held a board meeting this morning. It announced that it had decided to spin off itself into a surviving company named SK Telecom and a new company, tentatively named SKT Investment. In addition, it also announced a 5 for 1 stock split.</p><p>The spin-off ratio is 0.6073625 for the surviving company and 0.3926375 for the newly established company based on the book value of net assets. The split date is November 1. The name of the surviving company will remain SK Telecom, and the name of the new company will be finalized before the extraordinary general meeting scheduled for October 12.</p><table class="table table-striped">
<colgroup>
<col width="100">
<col width="100">
</colgroup>
<tbody>
<tr><td colspan="2" style="width: 726.008px;" data-sheets-value='{"1":2,"2":"Overview"}'>Overview</td></tr>
<tr>
<td style="width: 352.5px;" data-sheets-value='{"1":2,"2":"Name"}'>Name</td>
<td style="text-align: right; width: 352.514px;" data-sheets-value='{"1":2,"2":"SK Telecom Co Ltd"}' data-sheets-formula='=googlefinance(R[1]C[0], "name")'>SK Telecom</td>
</tr>
<tr>
<td style="width: 352.5px;" data-sheets-value='{"1":2,"2":"Ticker"}'>Ticker</td>
<td style="text-align: right; width: 352.514px;" data-sheets-value='{"1":2,"2":"017670"}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula='="017670"'>017670</td>
</tr>
<tr>
<td style="width: 352.5px;" data-sheets-value='{"1":2,"2":"Surviving"}'>Surviving</td>
<td style="text-align: right; width: 352.514px;" data-sheets-value='{"1":2,"2":"SK Telecom Co Ltd"}'>SK Telecom</td>
</tr>
<tr>
<td style="width: 352.5px;" data-sheets-value='{"1":2,"2":" - Ticker"}'>- Ticker</td>
<td style="text-align: right; width: 352.514px;" data-sheets-value='{"1":2,"2":"017670"}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula="=R[-2]C[0]">017670</td>
</tr>
<tr>
<td style="width: 352.5px;" data-sheets-value='{"1":2,"2":" - Bourse"}'>- Bourse</td>
<td style="text-align: right; width: 352.514px;" data-sheets-value='{"1":2,"2":"KOSPI"}'>KOSPI</td>
</tr>
<tr>
<td style="width: 352.5px;" data-sheets-value='{"1":2,"2":" - Ratio"}'><strong>- Split ratio</strong></td>
<td style="text-align: right; width: 352.514px;" data-sheets-value='{"1":3,"3":0.6073625}'><strong>0.6073625</strong></td>
</tr>
<tr>
<td style="width: 352.5px;" data-sheets-value='{"1":2,"2":" - Type"}'><strong>- Type</strong></td>
<td style="text-align: right; width: 352.514px;" data-sheets-value='{"1":2,"2":"Operating company"}'><strong>Operating company</strong></td>
</tr>
<tr>
<td style="width: 352.5px;" data-sheets-value='{"1":2,"2":" - Stock split"}'>- Stock split</td>
<td style="text-align: right; width: 352.514px;" data-sheets-value='{"1":3,"3":1}' data-sheets-numberformat='{"1":2,"2":"#,##0.0"}'>5 for 1</td>
</tr>
<tr>
<td style="width: 352.5px;" data-sheets-value='{"1":2,"2":"New"}'>New</td>
<td style="text-align: right; width: 352.514px;" data-sheets-value='{"1":2,"2":"SKT Investment"}'>SKT Investment</td>
</tr>
<tr>
<td style="width: 352.5px;" data-sheets-value='{"1":2,"2":" - Type"}'>- Type</td>
<td style="text-align: right; width: 352.514px;" data-sheets-value='{"1":2,"2":"Equity spinoff"}'>Equity spinoff</td>
</tr>
<tr>
<td style="width: 352.5px;" data-sheets-value='{"1":2,"2":" - Ticker"}'>- Ticker</td>
<td style="text-align: right; width: 352.514px;" data-sheets-value='{"1":2,"2":"TBA"}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}'>TBA</td>
</tr>
<tr>
<td style="width: 352.5px;" data-sheets-value='{"1":2,"2":" - Bourse"}'>- Bourse</td>
<td style="text-align: right; width: 352.514px;" data-sheets-value='{"1":2,"2":"KOSPI"}'>KOSPI</td>
</tr>
<tr>
<td style="width: 352.5px;" data-sheets-value='{"1":2,"2":" - Ratio"}'><strong>- Split ratio</strong></td>
<td style="text-align: right; width: 352.514px;" data-sheets-value='{"1":3,"3":0.3926375}'><strong>0.3926375</strong></td>
</tr>
<tr>
<td style="width: 352.5px;" data-sheets-value='{"1":2,"2":" - Type"}'><strong>- Type</strong></td>
<td style="text-align: right; width: 352.514px;" data-sheets-value='{"1":2,"2":"Holding company"}'><strong>Investment holding company</strong></td>
</tr>
<tr>
<td style="width: 352.5px;" data-sheets-value='{"1":2,"2":" - Stock split"}'>- Stock split</td>
<td style="text-align: right; width: 352.514px;" data-sheets-value='{"1":2,"2":"5 for 1"}' data-sheets-numberformat='{"1":2,"2":"#,##0.0"}'>5 for 1</td>
</tr>
<tr><td colspan="2" style="width: 726.008px;" data-sheets-value='{"1":2,"2":"Source: DART"}' data-sheets-numberformat='{"1":2,"2":"#,##0","3":1}'>Source: DART</td></tr>
</tbody>
</table><p>SK Telecom plans to hold an extraordinary general meeting of shareholders on October 12. Both companies will be listed (surviving company) and re-listed (new company) on November 29, when the stock trading suspension period ends on November 26.</p><table class="table table-striped">
<colgroup>
<col width="100">
<col width="100">
</colgroup>
<tbody>
<tr><td colspan="2" rowspan="1" data-sheets-value='{"1":2,"2":"Timetable"}' data-sheets-note="Sang Hyun Park: We have to buy shares until BOD+1 and hold onto them until the day immediately before the ex-rights date to be eligible to receive stock purchase rights. We then have to notify our dissenting opinion until the end of dissenting opinion notice period.">Timetable</td></tr>
<tr>
<td data-sheets-value='{"1":2,"2":"BOD meeting"}'>BOD meeting</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44357}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'>2021. 6. 10</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Shareholder approval at EGM"}'>Shareholder approval at EGM</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44481}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'>2021. 10. 12</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Trade suspension begins"}'><strong>Trade suspension begins</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44495}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'><strong>2021. 10. 26</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Trade suspension ends"}'>Trade suspension ends</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44526}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'>2021. 11. 26</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Re-listing"}'><strong>Re-listing</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":44529}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'><strong>2021. 11. 29</strong></td>
</tr>
<tr><td colspan="2" rowspan="1" data-sheets-value='{"1":2,"2":"Source: DART"}'>Source: DART</td></tr>
</tbody>
</table><h2>Stock split</h2><p>SK Telecom also proceeds with a 5 for 1 stock split at the same time. One ordinary share with a par value of ₩500 now becomes 5 shares with a par value of ₩100. As a result, the total number of issued shares will increase from the current 72,061,143 to 360,300,715. Both equity spinoff and stock split will be effective as of November 29, the listing and re-listing day.</p><hr><p>So,</p><div class="content-highlight"><p><strong>Suppose you own 20 shares of SK Telecom, you will have 100 shares, which has increased 5 times due to the stock split, and will receive 60 shares of the surviving company and 39 shares of the new company, respectively, according to a 6 to 4 split ratio. Fractional shares will be paid in cash at the closing price on November 29.</strong></p></div>

This post details SK Telecom's spinoff announcement filed this morning. Please note that this post doesn't have an investment recommendation.Equity spinoffSK Telecom held a board meeting this morning. It announced that it had decided to spin off itself into a surviving company named SK Telecom and a new company, tentatively named SKT Investment. In addition, it also announced a 5 for 1 stock split.The spin-off ratio is 0.6073625 for the surviving company and 0.3926375 for the newly established company based on the book value of net assets. The split date is November 1. The name of the surviving company will remain SK Telecom, and the name of the new company will be finalized before the extraordinary general meeting scheduled for October 12.





Overview

Name
SK Telecom


Ticker
017670


Surviving
SK Telecom


- Ticker
017670


- Bourse
KOSPI


- Split ratio
0.6073625


- Type
Operating company


- Stock split
5 for 1


New
SKT Investment


- Type
Equity spinoff


- Ticker
TBA


- Bourse
KOSPI


- Split ratio
0.3926375


- Type
Investment holding company


- Stock split
5 for 1

Source: DART

SK Telecom plans to hold an extraordinary general meeting of shareholders on October 12. Both companies will be listed (surviving company) and re-listed (new company) on November 29, when the stock trading suspension period ends on November 26.





Timetable

BOD meeting
2021. 6. 10


Shareholder approval at EGM
2021. 10. 12


Trade suspension begins
2021. 10. 26


Trade suspension ends
2021. 11. 26


Re-listing
2021. 11. 29

Source: DART

Stock splitSK Telecom also proceeds with a 5 for 1 stock split at the same time. One ordinary share with a par value of ₩500 now becomes 5 shares with a par value of ₩100. As a result, the total number of issued shares will increase from the current 72,061,143 to 360,300,715. Both equity spinoff and stock split will be effective as of November 29, the listing and re-listing day.So,Suppose you own 20 shares of SK Telecom, you will have 100 shares, which has increased 5 times due to the stock split, and will receive 60 shares of the surviving company and 39 shares of the new company, respectively, according to a 6 to 4 split ratio. Fractional shares will be paid in cash at the closing price on November 29.

SK Telecom Announcement: Split Ratio, Stock Split, Financials, Subsidiaries, & ADR Treatment

<h2>Share buyback</h2><p>LG U+ announced a well-anticipated share buyback. Well, the announcement was made earlier than initially expected. Also, the size is much smaller than ₩300B that the local street anticipated.</p><p>It is a ₩100.0B buyback, representing 1.49% of the total shares at the last closing price and 1.35% of the total equity.</p><table class="table table-striped">
<colgroup>
<col width="300">
<col width="300">
</colgroup>
<tbody>
<tr><td colspan="2" data-sheets-value='{"1":2,"2":"Overview (₩B)"}'>Buyback overview</td></tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Shares outstanding"}'>Shares outstanding</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":436611361}' data-sheets-numberformat='{"1":2,"2":"#,##0"}' data-sheets-formula="=sum(R[1]C[0]:R[2]C[0])">436,611,361</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Treasury shares"}'>Treasury shares</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":3}' data-sheets-numberformat='{"1":2,"2":"#,##0"}' data-sheets-formula="=sum(R[1]C[0]:R[2]C[0])">3</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Target qty."}'><strong>Target qty.</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":6493506.493506493}' data-sheets-numberformat='{"1":2,"2":"#,##0"}' data-sheets-formula="=R[2]C[0]"><strong>6,493,506</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - % of SO"}'><strong>- % of SO</strong></td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.014872509223383432}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula="=R[-1]C[0]/R[-7]C[0]"><strong>1.49%</strong></td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Treasury shares after buyback"}'>Treasury shares after buyback</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":6493509.493506493}' data-sheets-numberformat='{"1":2,"2":"#,##0"}' data-sheets-formula="=R[-11]C[0]+R[-8]C[0]">6,493,509</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - % of SO"}'>- % of SO</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.014872516094482693}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula="=R[-1]C[0]/R[-15]C[0]">1.49%</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Total value"}'>Total value</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":100}' data-sheets-numberformat='{"1":2,"2":"₩#,##0.0B"}' data-sheets-formula="=sum(R[1]C[0]:R[2]C[0])">₩100.0B</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":"Equity"}'>Equity</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":7418.124854889}' data-sheets-numberformat='{"1":2,"2":"₩#,##0.0B"}'>₩7,418.1B</td>
</tr>
<tr>
<td data-sheets-value='{"1":2,"2":" - % of equity"}'>- % of equity</td>
<td style="text-align: right;" data-sheets-value='{"1":3,"3":0.013480495671907417}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula="=R[-6]C[0]/R[-1]C[0]">1.35%</td>
</tr>
<tr><td colspan="2" data-sheets-value='{"1":2,"2":"Source: DART"}'>Source: DART</td></tr>
</tbody>
</table><h2>Daily buyback impact</h2><p>The buyback is a year. Well, the usual period for a buyback in Korea is 3 months. But we see more and more companies do a year-long buyback of late.</p><p>The buyback begins tomorrow and runs for a year until June 8 next year. We have a daily equal-weighted buyback of 25,871 shares, representing a measly 0.89% of the 30-day average daily trade volume.</p><table class="table table-striped">
<colgroup>
<col width="300">
<col width="300">
</colgroup>
<tbody>
<tr><td colspan="2" style="width: 726.008px;" data-sheets-value='{"1":2,"2":"Execution"}'>Execution</td></tr>
<tr>
<td style="width: 352.5px;" data-sheets-value='{"1":2,"2":"Buyback begins"}'><strong>Buyback begins</strong></td>
<td style="text-align: right; width: 352.514px;" data-sheets-value='{"1":3,"3":44356}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'><strong>2021. 6. 9</strong></td>
</tr>
<tr>
<td style="width: 352.5px;" data-sheets-value='{"1":2,"2":"Buyback ends"}'><strong>Buyback ends</strong></td>
<td style="text-align: right; width: 352.514px;" data-sheets-value='{"1":3,"3":44720}' data-sheets-numberformat='{"1":5,"2":"yyyy. m. d","3":1}'><strong>2022. 6. 8</strong></td>
</tr>
<tr>
<td style="width: 352.5px;" data-sheets-value='{"1":2,"2":"Banker"}'>Banker</td>
<td style="text-align: right; width: 352.514px;" data-sheets-value='{"1":2,"2":"KB Securities Co., Ltd."}' data-sheets-numberformat='{"1":2,"2":"#,##0"}'>KB Securities Co., Ltd.</td>
</tr>
<tr>
<td style="width: 352.5px;" data-sheets-value='{"1":2,"2":"Method"}'>Method</td>
<td style="text-align: right; width: 352.514px;" data-sheets-value='{"1":2,"2":"Openly in the market (no off-hours block trade)"}'>Openly in the market (no off-hours block trade)</td>
</tr>
<tr>
<td style="width: 352.5px;" data-sheets-value='{"1":2,"2":"Number of trading days"}'>Number of trading days</td>
<td style="text-align: right; width: 352.514px;" data-sheets-numberformat='{"1":2,"2":"#,##0"}'>251</td>
</tr>
<tr>
<td style="width: 352.5px;" data-sheets-value='{"1":2,"2":"Daily equal-weighted buyback qty."}'><strong>Daily equal-weighted buyback qty.</strong></td>
<td style="text-align: right; width: 352.514px;" data-sheets-value='{"1":3,"3":25870.54379883065}' data-sheets-numberformat='{"1":2,"2":"#,##0"}' data-sheets-formula="=R[-35]C[0]/251"><strong>25,871</strong></td>
</tr>
<tr>
<td style="width: 352.5px;" data-sheets-value='{"1":2,"2":" - % of 1-month average daily trade volume"}'><strong>- % of 30-day average daily trade volume</strong></td>
<td style="text-align: right; width: 352.514px;" data-sheets-value='{"1":3,"3":0.008940932608776117}' data-sheets-numberformat='{"1":3,"2":"0.00%","3":1}' data-sheets-formula='=R[-1]C[0]/googlefinance(R[-43]C[0], "volumeavg")'><strong>0.89%</strong></td>
</tr>
<tr><td colspan="2" style="width: 726.008px;" data-sheets-value='{"1":2,"2":"Source: DART &amp; Google Finance"}'>Source: DART &amp; Google Finance</td></tr>
</tbody>
</table>

Share buybackLG U+ announced a well-anticipated share buyback. Well, the announcement was made earlier than initially expected. Also, the size is much smaller than ₩300B that the local street anticipated.It is a ₩100.0B buyback, representing 1.49% of the total shares at the last closing price and 1.35% of the total equity.





Buyback overview

Shares outstanding
436,611,361


Treasury shares
3


Target qty.
6,493,506


- % of SO
1.49%


Treasury shares after buyback
6,493,509


- % of SO
1.49%


Total value
₩100.0B


Equity
₩7,418.1B


- % of equity
1.35%

Source: DART

Daily buyback impactThe buyback is a year. Well, the usual period for a buyback in Korea is 3 months. But we see more and more companies do a year-long buyback of late.The buyback begins tomorrow and runs for a year until June 8 next year. We have a daily equal-weighted buyback of 25,871 shares, representing a measly 0.89% of the 30-day average daily trade volume.





Execution

Buyback begins
2021. 6. 9


Buyback ends
2022. 6. 8


Banker
KB Securities Co., Ltd.


Method
Openly in the market (no off-hours block trade)


Number of trading days
251


Daily equal-weighted buyback qty.
25,871


- % of 30-day average daily trade volume
0.89%

Source: DART &amp; Google Finance



LG U+ Buyback Announcement: Details & Impacts

<p>After the market close today (8 June), <a href="https://www.smartkarma.com/entities/lg-uplus-corp" target="_blank" data-smartkarma-citation="entities:1113:1" rel="noopener">LG Uplus Corp (032640 KS)</a> announced that it will complete share buyback worth 100 billion won as well the start of interim dividends starting this year. LG Uplus currently has a market cap of 6.7 trillion won so this buyback would be worth 1.5% of outstanding shares. The start of the 100 billion won worth of share buyback program starts on 9 June 2021 and ends on 8 June 2022.</p><p>There have been some rumors in the local media (previous to today's announcement) that there could be a buyback worth nearly 300 billion won. So today's announcement of 100 billion won in share buyback would be only about 1/3 of the amount mentioned in recent local media. With regards to share buyback, LG Uplus follows SK Telecom and KT Corp that have both announced share buyback programs in the past year. </p><div class="content-highlight">
<h2><strong>Conclusion:</strong></h2>
<p>LG Uplus' announcement to buyback 100 billion won worth of shares should have slightly positive impact on its share price. Its decision to make dividend payments bi-annually is also a step in the right direction. In the near term, there is an increasing probability that LG Uplus partners with Disney to provide Disney Plus OTT services in Korea. </p>
<p>Over a longer-term, there has definitely been a rotation from growth to value oriented stocks and sectors this year. The telcos have remained a key favorite and has been outperforming the market significantly. In the midst of these near-term and longer term catalysts and sector rotation, we have a positive view of LG Uplus. </p>
</div>

After the market close today (8 June), LG Uplus Corp (032640 KS) announced that it will complete share buyback worth 100 billion won as well the start of interim dividends starting this year. LG Uplus currently has a market cap of 6.7 trillion won so this buyback would be worth 1.5% of outstanding shares. The start of the 100 billion won worth of share buyback program starts on 9 June 2021 and ends on 8 June 2022.There have been some rumors in the local media (previous to today's announcement) that there could be a buyback worth nearly 300 billion won. So today's announcement of 100 billion won in share buyback would be only about 1/3 of the amount mentioned in recent local media. With regards to share buyback, LG Uplus follows SK Telecom and KT Corp that have both announced share buyback programs in the past year. 
Conclusion:
LG Uplus' announcement to buyback 100 billion won worth of shares should have slightly positive impact on its share price. Its decision to make dividend payments bi-annually is also a step in the right direction. In the near term, there is an increasing probability that LG Uplus partners with Disney to provide Disney Plus OTT services in Korea. 
Over a longer-term, there has definitely been a rotation from growth to value oriented stocks and sectors this year. The telcos have remained a key favorite and has been outperforming the market significantly. In the midst of these near-term and longer term catalysts and sector rotation, we have a positive view of LG Uplus. 


LG Uplus: A 100 Billion Won in Buyback, Bi-Annual Dividends, & A Potential Partnership with Disney

South Korea

SK Telecom Co., Ltd. is a Korean mobile and telecommunications operator. The Company provides cellular voice, wireless data, and wireless internet services. SK Telecom also offers fixed line services and platform services.

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SK Telecom (017670 KS)

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