In today’s briefing:
- EB Event Trade Setup: HD KSOE Lining up a New Deal with HD Hyundai Heavy as the Underlying
- Lotte Corp Sells 145 Billion Won Worth of Treasury Shares to Lotte Moolsan – Negative Governance
EB Event Trade Setup: HD KSOE Lining up a New Deal with HD Hyundai Heavy as the Underlying
- HD KSOE plans a second EB similar to earlier this year: a zero-coupon, 2% HD Hyundai Heavy stake with 13–15% premium, aiming to raise around ₩850 billion.
- With Korea’s Commercial Act revision expected by July 4, EB deals risk director liability; HD KSOE aims to raise cash now before stricter rules limit easy board-approved EB issuance.
- Targeting a short in HD Hyundai Heavy triggered by HD KSOE’s board approval before July 4; consider hedging with a long position in HD KSOE due to ongoing sector catalysts.
Lotte Corp Sells 145 Billion Won Worth of Treasury Shares to Lotte Moolsan – Negative Governance
- After the market close on 26 June, LOTTE Corporation (004990 KS) announced that it sold 5% of its outstanding shares worth 145 billion won to its affiliate Lotte Moolsan.
- This is poor corporate governance since the company should be cancelling the treasury shares instead.
- Major reason why Lotte Corp sold its 5% stake in the company to Lotte Moolsan is to have the Lotte Group Chairman’s Shin family maintain control over the Lotte Group.
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