Korea/Asia, Events, IPOs, Douglas Research Advisory

Douglas Kim

Nearly 30 years of experience in the Korean/Asian equity research. Major sectors coverage include the following:
- Technology 
- Consumer 
- Special Situations/Deep Value Plays
- Tender Offers/M&As
- Holdcos/Stubs
- Asian Unicorns/Private Companies

Korea/Asia, Events, IPOs

Equity Capital Markets

Point Mobile Co Ltd / Equity Capital Markets

<p>Point Mobile is a Korean company getting ready to complete its IPO in November. The IPO price range is from 13,000 won to 15,000 won. The IPO base deal size is from $12 million to $14 million. The bookbuilding for the institutional investors will start on 26 October 2020. Hana Investment &amp; Securities is the lead underwriter of this IPO. </p>
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<h3>Amazon Could Become the 2nd Largest Shareholder of Point Mobile</h3>
<p>One of the most interesting aspects of Point Mobile is that it has given a pre-emptive rights to Amazon, one of its major customers. According to this contract which was signed in July 2020, the length of the contract lasts 8 years and it includes Amazon purchasing various products from Point Mobile (cumulative amount of $200 million in sales). In return, Amazon could purchase 1.48 million new shares in Point Mobile. If Amazon exercises 100% of this rights, Amazon would become the second-largest shareholder with a 17.7% stake in the company.</p>
<p>Currently, the founder and CEO Kang Sam-Kwon is the controlling shareholder with a 21.2% stake in the company. Jang Young-Wook (founder's wife) has a 10.6% stake. There are also treasury shares worth 3.8% of outstanding shares. </p>
<p>The fact that Amazon was willing to enter into a long-term contract with Point Mobile is positive for the company. It shows that Amazon is impressed with the company's products, so much so that it is willing to become the second-largest shareholder in the company. Later on, if Amazon does exercise its rights and become the 2nd largest shareholder in the company, this would also have a major positive impact on Point Mobile since it could result in significantly higher incremental revenues from Amazon.</p>
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Point Mobile is a Korean company getting ready to complete its IPO in November. The IPO price range is from 13,000 won to 15,000 won. The IPO base deal size is from $12 million to $14 million. The bookbuilding for the institutional investors will start on 26 October 2020. Hana Investment &amp; Securities is the lead underwriter of this IPO. 

Amazon Could Become the 2nd Largest Shareholder of Point Mobile
One of the most interesting aspects of Point Mobile is that it has given a pre-emptive rights to Amazon, one of its major customers. According to this contract which was signed in July 2020, the length of the contract lasts 8 years and it includes Amazon purchasing various products from Point Mobile (cumulative amount of $200 million in sales). In return, Amazon could purchase 1.48 million new shares in Point Mobile. If Amazon exercises 100% of this rights, Amazon would become the second-largest shareholder with a 17.7% stake in the company.
Currently, the founder and CEO Kang Sam-Kwon is the controlling shareholder with a 21.2% stake in the company. Jang Young-Wook (founder's wife) has a 10.6% stake. There are also treasury shares worth 3.8% of outstanding shares. 
The fact that Amazon was willing to enter into a long-term contract with Point Mobile is positive for the company. It shows that Amazon is impressed with the company's products, so much so that it is willing to become the second-largest shareholder in the company. Later on, if Amazon does exercise its rights and become the 2nd largest shareholder in the company, this would also have a major positive impact on Point Mobile since it could result in significantly higher incremental revenues from Amazon.


Point Mobile Co Ltd

Point Mobile IPO Preview