Hoban Becomes Hanjin KAL Corporation’s Largest Shareholder, but Walter Cho Is Set to Reclaim the Position After Completing His Share Purchase

[Financial News] Hanjin KAL Corporation said on the 4th that Hoban Group had become its largest shareholder. However, Walter Cho, chairman of Hanjin Group, is expected to reclaim the position if he completes the additional share purchase he announced earlier.
Hanjin KAL Corporation disclosed that Hoban Construction and its related parties had become its largest shareholder, holding 13,814,053 common shares, or a 20.69% stake. Chairman Cho and his related parties hold 13,738,919 common shares, or a 20.58% stake.
Hoban Group, which had remained the second-largest shareholder, recently bought additional shares in Hanjin KAL Corporation and reported the purchase to the Korea Fair Trade Commission. When the business combination review, which had been completed at the time of its earlier acquisition of a 15% stake, was conducted again, industry observers had speculated that this was because Hoban had become the largest investor.
Soon after Hoban Group’s additional stake acquisition became known, Walter Cho, chairman of Hanjin Group, disclosed that he would purchase 325,000 shares through an after-hours block trade, starting next month and continuing through New Year’s Day. Hanjin KAL Corporation explained that the plan had been made independently of Hoban Group’s stake acquisition, but the situation turned into a contest over the largest shareholder position.
Hoban Group ultimately became the largest shareholder, but the issue of management control is separate. Cho’s control is secure because of substantial friendly stakes, including Delta Air Lines, which has formed a joint venture (JV) with Korean Air. The Korea Fair Trade Commission is also expected to consider actual control and relationships among shareholders in its business combination review, while Hoban Group has not yet changed its stated purpose from “simple investment.”
Hoban Group is also expected to have difficulty holding on to the largest-shareholder position. Cho is expected to reclaim it as soon as he completes the share purchase he disclosed. After the purchase is completed early next year, Cho and his related parties are expected to hold a 21.07% stake.
A Hanjin KAL Corporation official said, “As disclosed on the 2nd, if the purchase of 325,000 shares (a 0.49% stake) is completed in early December, Chairman Cho and his related parties could become the largest shareholder of Hanjin KAL Corporation.”
[email protected] Kim Yun-ho Reporter