Hyundai plans rights offering to meet criteria

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Hyundai plans rights offering to meet criteria

Hyundai Securities, Korea’s No. 3 brokerage by market cap, said yesterday it plans to conduct a rights offering worth 595 billion won ($519 million) to meet the government’s minimum requirement to become an investment bank.

The brokerage said in a regulatory filing it will issue 70 million preferred shares at 8,500 won apiece.

The move is set to boost Hyundai Securities’ equity capital to 3.16 trillion won from 2.56 trillion won as of end-June.

In July, the country’s financial regulator said it plans to allow brokerages with an equity capital over 3 trillion won to become investment banks. Three of the country’s five largest brokerages by equity capital have already announced plans for rights offerings. Daewoo Securities is pushing for a 1.4 trillion won rights offering and Woori Investment & Securities and Samsung Securities plan to issue new shares worth 600 billion won and 400 billion won, respectively.

A spokesman for Korea Investment & Securities said its parent Korea Investment Holdings is reviewing a rights offering but said no details have yet been determined.

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