KOTEC Expands Corporate Succession M&A Guarantees with Shinhan Bank

Eligible for Corporate Succession and Technological Innovation M&A Guarantees

Korea Technology Finance Corporation (KOTEC) announced on the 31st that it had signed a "Financial Business Agreement for Mergers and Acquisitions (M&A) to Promote Corporate Succession and Technological Innovation" with Shinhan Bank at Shinhan Bank’s headquarters in Jung-gu, Seoul, on the 28th.

This agreement was designed to address the challenges of corporate succession arising from the aging of small and medium-sized enterprise (SME) owners and to alleviate the financial burden on companies pursuing M&A, thereby establishing a foundation for sustainable growth.

On the 28th, officials from the Korea Technology Finance Corporation and Shinhan Bank are taking a commemorative photo at the Mergers and Acquisitions (M&A) Financial Support Business Agreement Ceremony for Promoting Corporate Succession and Technological Innovation held at Shinhan Bank headquarters in Jung-gu, Seoul. Photo by Korea Technology Finance Corporation

Under the agreement, KOTEC will use a special contribution of 1 billion won provided by Shinhan Bank to supply special contribution agreement guarantees worth a total of 20 billion won. The guarantee ratio will be raised from the current 85% to 100% for three years, and a preferential benefit of a 0.3 percentage point reduction in guarantee fees will be provided. In addition, with 300 million won in guarantee fee support from Shinhan Bank, KOTEC will provide guarantee fee support agreement guarantees worth 21.4 billion won. Shinhan Bank will also support guarantee fees by 0.7 percentage points for two years.

Eligible recipients of support are companies that meet the technology guarantee requirements of KOTEC and are subject to corporate succession M&A guarantees or technological innovation M&A guarantees. The corporate succession M&A guarantees are provided to companies whose incumbent CEOs of the acquired companies are 60 years old or older and have managed the company for more than five years. The technological innovation M&A guarantees are offered to acquiring companies pursuing M&A activities.

The two organizations plan to use this agreement as an opportunity to enhance financial accessibility for companies pursuing M&A and continue cooperation to ensure smooth financial support for corporate succession and technological innovation.

An official from KOTEC stated, "Moving forward, we will expand support for companies pursuing M&A by strengthening our collaboration with related organizations, and reinforce the support base for the sustainable growth and smooth succession of technology companies."

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