JoongAng Chairman Seokhyun Hong Sells Entire BGF Stake... Secures Liquidity After JTBC Default

Seokhyun Hong, Chairman of JoongAng Holdings, Sells Entire 1.07% Stake in BGF for 4.2 Billion Won

Move Seen as Effort to Secure Liquidity Amid JoongAng Group’s Rehabilitation Proceedings

Following JTBC’s declaration of default, it has been confirmed that Seokhyun Hong, Chairman of JoongAng Holdings, has sold all of his shares in BGF, amid a wave of corporate rehabilitation filings by JoongAng Group affiliates. The market interprets this move as an effort to secure group-wide liquidity.

Seokhyun Hong, Chairman of JoongAng Holdings.

According to the Financial Supervisory Service’s electronic disclosure system on June 17, Seokhyun Hong, Chairman of JoongAng Holdings and a related party, sold a total of 1,021,212 common shares of BGF in five transactions between June 9 and June 15. The selling price ranged between 3,995 won and 4,227 won per share, with the total estimated value of the sale at around 4.2 billion won. As a result, Mr. Hong’s stake in BGF decreased from 1,021,212 shares (approximately 1.07%) to zero.

The disclosure cited “termination of related party status” as the reason for the sale. Under the Capital Markets Act, a related party includes the largest shareholder, their relatives, and corporations under their control.

The fact that this sale took place after JTBC’s default announcement has strengthened the interpretation that JoongAng Group is actively seeking to secure liquidity. Recently, JoongAng Group’s liquidity crisis has come to the surface after key affiliates filed for rehabilitation procedures. In this situation, as the owner family has liquidated shares in a listed company, market observers believe this move goes beyond simple portfolio adjustment and may have broader implications.

In fact, Chairman Seokhyun Hong is the eldest son of the late founder, Jinki Hong, and the brother of Seokjo Hong, Chairman of BGF. While the BGF stake is not directly related to the management of JoongAng Group, it is classified as an asset that can be converted into cash if necessary.

Meanwhile, JTBC, a core affiliate of JoongAng Group, declared default on June 12 after failing to repay 20.6 billion won in asset-backed loans on time. Subsequently, on June 14, JoongAng Holdings, ContentreeJoongAng, Joongang P&I, and MegaboxJoongAng filed for commencement of rehabilitation proceedings. JoongAng Holdings and ContentreeJoongAng also applied for preservation measures and a comprehensive prohibition order, and JTBC filed an additional rehabilitation application.

The Seoul Bankruptcy Court’s Rehabilitation Division 2 is scheduled to hold a hearing for the representatives of JTBC and JoongAng Group affiliates on June 23.

This content was produced with the assistance of AI translation services.