Korea / Special Situations, Clepsydra Capital

Sanghyun Park

I investigate special situations in Korea.

Korea / Special Situations

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SK Planet's 11st - Close to Raising 500 Billion Won for a 15 to 20% Stake

Event-Driven

<a href="https://www.smartkarma.com/entities/395" target="_blank" data-smartkarma-citation="entities:395:1">SK Telecom (017670 KS)</a>'s 'nearly' wholly-owned subsidiary SK Planet spun off (in the form of equity spinoff) the Internet commerce business unit which operates one of Korea's leading online commerce website called "11st.com". SKT also said in a regulatory filing that SK Planet will re-merge with SKT's another wholly-owned subsidiary SK Techx which was originally a SK Planet's internal business unit and got spun off from SK Planet in 2016.<div class="content-highlight"><a href="https://dart.fss.or.kr/report/viewer.do?rcpNo=20180619800405&amp;dcmNo=6220440&amp;eleId=0&amp;offset=0&amp;length=0&amp;dtd=HTML" target="_blank">The link of the regulatory filing about 11st.com spinoff</a> (source: DART)<a href="https://dart.fss.or.kr/report/viewer.do?rcpNo=20180619800408&amp;dcmNo=6220441&amp;eleId=0&amp;offset=0&amp;length=0&amp;dtd=HTML" target="_blank">The link of the regulatory filing about SK Planet &amp; SK Techx merger</a> (source: DART)</div>Below is the list of SKT's major subsidiaries. SKT owns a 98.1% stake in SK Planet whose asset value is ₩1.53tril. 11st.com is one of SK Planet's internal business units. Through this equity spinoff, 11st.com will be separated from SK Planet and will be placed directly under SKT which will continue to retain a 98.1% stake in 11st.com and SK Planet. At the same time, SK Planet will merge with SK Techx which is wholly-owned by SKT and whose asset value is ₩238bil. SK Planet will be the surviving entity. That is, SK Techx will be gone.<table class="table table-striped"><colgroup></colgroup><tbody><tr><td style="width: 309px;" data-sheets-value="{&quot;1&quot;:2,&quot;2&quot;:&quot;SKT's major subsidiaries&quot;}">SKT's major subsidiaries</td><td style="text-align: right; width: 263.29998779296875px;" data-sheets-value="{&quot;1&quot;:2,&quot;2&quot;:&quot;SKT's shareholding (%)&quot;}">SKT's shareholding (%)</td><td style="text-align: right; width: 199.70001220703125px;" data-sheets-value='{"1":2,"2":"Asset (₩ bil)"}'>Asset (₩ bil)</td></tr><tr><td style="width: 309px;" data-sheets-value='{"1":2,"2":"SK Hynix"}'>SK Hynix</td><td style="text-align: right; width: 263.29998779296875px;" data-sheets-value='{"1":3,"3":20.1}'>20.1</td><td style="text-align: right; width: 199.70001220703125px;" data-sheets-value='{"1":3,"3":49125.1}' data-sheets-numberformat='{"1":2,"2":"#,##0.00","3":1}'>49,125.1</td></tr><tr><td style="width: 309px;" data-sheets-value='{"1":2,"2":"SK Broadband"}'>SK Broadband</td><td style="text-align: right; width: 263.29998779296875px;" data-sheets-value='{"1":3,"3":100}'>100.0</td><td style="text-align: right; width: 199.70001220703125px;" data-sheets-value='{"1":3,"3":3802.3}' data-sheets-numberformat='{"1":2,"2":"#,##0.00","3":1}'>3,802.3</td></tr><tr><td style="width: 309px;" data-sheets-value='{"1":2,"2":"SK Planet"}'>SK Planet - SK Planet owns 11st.com.</td><td style="text-align: right; width: 263.29998779296875px;" data-sheets-value='{"1":3,"3":98.1}'>98.1</td><td style="text-align: right; width: 199.70001220703125px;" data-sheets-value='{"1":3,"3":1534.9}' data-sheets-numberformat='{"1":2,"2":"#,##0.00","3":1}'>1,534.9</td></tr><tr><td style="width: 309px;" data-sheets-value='{"1":2,"2":"PS&amp; Marketing"}'>PS&amp; Marketing</td><td style="text-align: right; width: 263.29998779296875px;" data-sheets-value='{"1":3,"3":100}'>100.0</td><td style="text-align: right; width: 199.70001220703125px;" data-sheets-value='{"1":3,"3":506.9}'>506.9</td></tr><tr><td style="width: 309px;" data-sheets-value='{"1":2,"2":"SK Telink"}'>SK Telink</td><td style="text-align: right; width: 263.29998779296875px;" data-sheets-value='{"1":3,"3":85.9}'>85.9</td><td style="text-align: right; width: 199.70001220703125px;" data-sheets-value='{"1":3,"3":455.7}'>455.7</td></tr><tr><td style="width: 309px;" data-sheets-value='{"1":2,"2":"SK Techx"}'>SK Techx</td><td style="text-align: right; width: 263.29998779296875px;" data-sheets-value='{"1":3,"3":100}'>100.0</td><td style="text-align: right; width: 199.70001220703125px;" data-sheets-value='{"1":3,"3":237.7}'>237.7</td></tr><tr><td style="width: 309px;" data-sheets-value='{"1":2,"2":"Iriver"}'>Iriver</td><td style="text-align: right; width: 263.29998779296875px;" data-sheets-value='{"1":3,"3":48.9}'>48.9</td><td style="text-align: right; width: 199.70001220703125px;" data-sheets-value='{"1":3,"3":132.1}'>132.1</td></tr><tr><td colspan="3" style="width: 309px;" data-sheets-value='{"1":2,"2":"SK Communications"}'><hr></td></tr><tr><td style="width: 309px;" data-sheets-value='{"1":2,"2":"SK Communications"}'>ADT Caps</td><td style="text-align: right; width: 263.29998779296875px;" data-sheets-value='{"1":3,"3":64.5}'>55.0</td><td style="text-align: right; width: 199.70001220703125px;" data-sheets-value='{"1":3,"3":90.9}'>-</td></tr><tr><td colspan="3" style="width: 772px;" data-sheets-value='{"1":2,"2":"SK Communications"}'>Note: Asset values are as of Mar 2018.Source: FnGuide</td></tr></tbody></table><hr>Below are more details about the 11st.com spinoff.<table class="table table-striped"><tbody><tr><td colspan="3">11st.com spinoff from SK Planet</td></tr><tr><td>Entity type</td><td style="text-align: left;">Company</td><td style="text-align: left;">Spinoff ratio</td></tr><tr><td>Surviving entity</td><td style="text-align: left;">SK Planet</td><td style="text-align: left;">0.8565581</td></tr><tr><td>New entity</td><td style="text-align: left;">11st.com </td><td style="text-align: left;">0.1434419</td></tr><tr><td colspan="3">Source: DART</td></tr></tbody></table><table class="table table-striped"><tbody><tr><td>(₩ mil)</td><td style="text-align: right;">SK Planet (surviving entity)</td><td style="text-align: right;">11st.com (new entity)</td></tr><tr><td>1Q18 Asset</td><td style="text-align: right;">836,011</td><td style="text-align: right;">582,806</td></tr><tr><td>1Q18 Liabilities</td><td style="text-align: right;">344,357</td><td style="text-align: right;">499,906</td></tr><tr><td>1Q18 Equity</td><td style="text-align: right;">491,654</td><td style="text-align: right;">82,900</td></tr><tr><td>1Q18 Capital</td><td style="text-align: right;">25,032</td><td style="text-align: right;">4,192</td></tr><tr><td>FY17 sales</td><td style="text-align: right;">303,585</td><td style="text-align: right;">688,005</td></tr><tr><td colspan="3">Source: DART</td></tr></tbody></table><table class="table table-striped"><tbody><tr><td colspan="2">Event schedule</td></tr><tr><td>Board resolution</td><td style="text-align: right;">June 19, 2018</td></tr><tr><td>Shareholder meeting</td><td style="text-align: right;">July 31, 2018</td></tr><tr><td>Spinoff date</td><td style="text-align: right;">Sep 1, 2018</td></tr><tr><td>New share issuance</td><td style="text-align: right;">Sep 21, 2018</td></tr><tr><td colspan="2">Source: DART</td></tr></tbody></table>Below are more details about the SK Planet+SK Techx merger.<table class="table table-striped"><tbody><tr><td colspan="3">SK Planet+SK Techx merger</td></tr><tr><td>Entity type</td><td style="text-align: left;">Company</td><td style="text-align: left;">Merger ratio</td></tr><tr><td>Surviving entity</td><td style="text-align: left;">SK Planet</td><td style="text-align: left;">1</td></tr><tr><td>Extinct entity</td><td style="text-align: left;">SK Techx </td><td style="text-align: left;">3.0504171</td></tr><tr><td colspan="3">Source: DART</td></tr></tbody></table><table class="table table-striped"><tbody><tr><td>(₩ mil)</td><td style="text-align: right;">SK Planet (surviving entity)</td><td style="text-align: right;">SK Techx (extinct entity)</td></tr><tr><td>1Q18 Asset</td><td style="text-align: right;">836,011</td><td style="text-align: right;">237,700</td></tr><tr><td>1Q18 Liabilities</td><td style="text-align: right;">344,357</td><td style="text-align: right;">41,562</td></tr><tr><td>1Q18 Equity</td><td style="text-align: right;">491,654</td><td style="text-align: right;">196,138</td></tr><tr><td>1Q18 Capital</td><td style="text-align: right;">25,032</td><td style="text-align: right;">3,357</td></tr><tr><td>FY17 sales</td><td style="text-align: right;">303,585</td><td style="text-align: right;">195,948</td></tr><tr><td colspan="3">Source: DART</td></tr></tbody></table><table class="table table-striped"><tbody><tr><td colspan="2">Event schedule</td></tr><tr><td>Board resolution</td><td style="text-align: right;">June 19, 2018</td></tr><tr><td>Shareholder meeting</td><td style="text-align: right;">July 31, 2018</td></tr><tr><td>Merger date</td><td style="text-align: right;">Sep 1, 2018</td></tr><tr><td>New share issuance</td><td style="text-align: right;">Sep 21, 2018</td></tr><tr><td colspan="2">Source: DART</td></tr></tbody></table><hr>Below are the business areas of the entities that are involved in these spinoff/merger processes.<table class="table table-striped"><tbody><tr><td colspan="2" style="width: 772px;">Business areas of each entity</td></tr><tr><td style="width: 278.9624938964844px;">SK Planet (surviving entity)</td><td style="width: 493.0375061035156px;"><ul><li>OK Cashbag: Loyalty program</li><li>Syrup wallet: smart commerce app service</li><li>Shopkick: US based mobile shopping app</li><li>Cotoco: Mobile gift voucher service</li></ul></td></tr><tr><td style="width: 278.9624938964844px;">11st.com (new entity)</td><td style="width: 493.0375061035156px;"><ul><li>11st: Online marketplace (open market)</li><li>Shockingdeal by 11st: Mobile shopping optimization service</li><li>n11.com: Online marketplace</li><li>Gifticon: Online gift voucher service</li><li>11Pay: Online payment service</li></ul></td></tr><tr><td style="width: 278.9624938964844px;">SK Techx (extinct entity)</td><td style="width: 493.0375061035156px;"><ul><li>MusicMate: Streaming radio service application</li><li>Datasoda: Online mileage service</li><li>Weather Pong: Real-time weather information app</li><li>Volo: Travel journal app</li><li>T coloring: Mobile phone ringtones (coloring) app</li><li>C.LINK: Mobile phone backup/restoration service</li><li>Cloud streaming: Cloud based streaming platform/service</li></ul></td></tr><tr><td colspan="2" style="width: 772px;">Source: SK Planet, SK Techx</td></tr></tbody></table>

SK Telecom (017670 KS)'s 'nearly' wholly-owned subsidiary SK Planet spun off (in the form of equity spinoff) the Internet commerce business unit which operates one of Korea's leading online commerce website called "11st.com". SKT also said in a regulatory filing that SK Planet will re-merge with SKT's another wholly-owned subsidiary SK Techx which was originally a SK Planet's internal business unit and got spun off from SK Planet in 2016.The link of the regulatory filing about 11st.com spinoff (source: DART)The link of the regulatory filing about SK Planet &amp; SK Techx merger (source: DART)Below is the list of SKT's major subsidiaries. SKT owns a 98.1% stake in SK Planet whose asset value is ₩1.53tril. 11st.com is one of SK Planet's internal business units. Through this equity spinoff, 11st.com will be separated from SK Planet and will be placed directly under SKT which will continue to retain a 98.1% stake in 11st.com and SK Planet. At the same time, SK Planet will merge with SK Techx which is wholly-owned by SKT and whose asset value is ₩238bil. SK Planet will be the surviving entity. That is, SK Techx will be gone.SKT's major subsidiariesSKT's shareholding (%)Asset (₩ bil)SK Hynix20.149,125.1SK Broadband100.03,802.3SK Planet - SK Planet owns 11st.com.98.11,534.9PS&amp; Marketing100.0506.9SK Telink85.9455.7SK Techx100.0237.7Iriver48.9132.1ADT Caps55.0-Note: Asset values are as of Mar 2018.Source: FnGuideBelow are more details about the 11st.com spinoff.11st.com spinoff from SK PlanetEntity typeCompanySpinoff ratioSurviving entitySK Planet0.8565581New entity11st.com 0.1434419Source: DART(₩ mil)SK Planet (surviving entity)11st.com (new entity)1Q18 Asset836,011582,8061Q18 Liabilities344,357499,9061Q18 Equity491,65482,9001Q18 Capital25,0324,192FY17 sales303,585688,005Source: DARTEvent scheduleBoard resolutionJune 19, 2018Shareholder meetingJuly 31, 2018Spinoff dateSep 1, 2018New share issuanceSep 21, 2018Source: DARTBelow are more details about the SK Planet+SK Techx merger.SK Planet+SK Techx mergerEntity typeCompanyMerger ratioSurviving entitySK Planet1Extinct entitySK Techx 3.0504171Source: DART(₩ mil)SK Planet (surviving entity)SK Techx (extinct entity)1Q18 Asset836,011237,7001Q18 Liabilities344,35741,5621Q18 Equity491,654196,1381Q18 Capital25,0323,357FY17 sales303,585195,948Source: DARTEvent scheduleBoard resolutionJune 19, 2018Shareholder meetingJuly 31, 2018Merger dateSep 1, 2018New share issuanceSep 21, 2018Source: DARTBelow are the business areas of the entities that are involved in these spinoff/merger processes.Business areas of each entitySK Planet (surviving entity)OK Cashbag: Loyalty programSyrup wallet: smart commerce app serviceShopkick: US based mobile shopping appCotoco: Mobile gift voucher service11st.com (new entity)11st: Online marketplace (open market)Shockingdeal by 11st: Mobile shopping optimization servicen11.com: Online marketplaceGifticon: Online gift voucher service11Pay: Online payment serviceSK Techx (extinct entity)MusicMate: Streaming radio service applicationDatasoda: Online mileage serviceWeather Pong: Real-time weather information appVolo: Travel journal appT coloring: Mobile phone ringtones (coloring) appC.LINK: Mobile phone backup/restoration serviceCloud streaming: Cloud based streaming platform/serviceSource: SK Planet, SK Techx

SK텔레콤 구조조정 - 11번가 분사 &amp; SK플래닛 &amp; SK테크엑스 합병

SK Telecom

SK텔레콤 구조조정 - 11번가 분사 &amp; SK플래닛 &amp; SK테크엑스 합병

SK텔레콤 구조조정 - 11번가 분사 & SK플래닛 & SK테크엑스 합병