Hanwha Galleria VP buys 34 million shares to boost price after sluggish Q2

Industry

Hanwha Galleria VP buys 34 million shares to boost price after sluggish Q2

Published: 23 Aug. 2024, 14:18 Updated: 23 Aug. 2024, 15:16

KIM JU-YEON
kim.juyeon2@joongang.co.kr

Hanwha Galleria Vice President Kim Dong-seon speaks at a brand conference for U.S. burger chain Five Guys in Seocho District, southern Seoul in June 2023. [NEWS1]

Hanwha Galleria Vice President Kim Dong-seon will purchase stock in an apparent move to boost the retailer's share price following its sluggish second quarter, in which it recorded its first-ever deficit after going public.

The vice president will buy 34 million shares, or 17.54 percent, at 1,600 won ($1.20) each in a tender offer, according to a regulatory filing submitted to the Financial Supervisory Service on Friday.

The premium is reportedly one of the highest put forward in a tender offer over the last three years, around 34 percent more than the average price of 1,190 won per Hanwha Galleria share recorded over the past month and 23 percent higher than Thursday’s price of 1,303 won.

The purchase, valued at 54.4 billion won in total, would give Kim a 19.8 percent stake combined with his current 2.32 percent, or 4.5 million shares. It will be made through his personal funds.

The vice president, who is known for his success bringing U.S. burger chain Five Guys to Korea, has bought stakes in Hanwha Galleria 137 times since last April. Despite the restaurant's success, however, Hanwha Galleria recorded 4.5 billion won in losses in this year's second quarter, mainly due to a drop in its department store division's revenue.

“In the unprecedented crisis of the company going into the red, [Vice President Kim] is expressing a strong will to see to the company’s growth along with shareholders with a heavier responsibility,” Hanwha Galleria CEO Kim Young-hoon said in a statement.

“The tender offer will represent a positive signal for its stock prices and enhance its corporate value.”

BY KIM JU-YEON [kim.juyeon2@joongang.co.kr]