Macquarie, Align Agree on Simultaneous Tender Offers for Gabia and KINX

Eliminating the Dual Listing Structure and Simplifying Corporate Governance
"A Model Case Offering Equal Treatment to Major and Ordinary Shareholders"

Macquarie Asset Management has agreed to acquire stakes from major shareholders of Gabia and KINX. After its tender offer for Gabia fell through last September, Macquarie is expected to have reached agreements with major shareholders, including Align Partners, and to have added KINX to the tender offer before pursuing the voluntary delisting of both companies.

On October 28, Macquarie Asset Management said that Macquarie Asia Pacific Infrastructure Fund 4 (MAIF4) had signed a stock purchase agreement the previous day with Gabia management and major shareholders, including Align Partners, miri capital and Gumshoe Capital. Under the agreement, it will acquire Gabia shares for 53,000 won per share and KINX shares for 190,000 won per share. Gabia's current management will reinvest some of the shares subject to the sale in a special purpose company (SPC) established for the acquisition and continue to participate in management.

The transaction is structured to link the acquisition of stakes from major shareholders with tender offers for shares held by ordinary shareholders. If conditions precedent, including government approval, are met, Macquarie will launch tender offers for all remaining shares held by ordinary shareholders of both companies and then pursue their voluntary delisting.

The tender offers are planned to begin within 10 business days of obtaining government approval. The same purchase price per share will apply to major and ordinary shareholders, with no minimum tender condition or cap on the number of shares to be acquired.

The transaction is expected to simplify Gabia's governance by eliminating its duplicate listing structure. This is expected to enable the company to establish a faster decision-making system to enhance corporate value over the long term. News of the tender offers sent both companies' shares sharply higher. As of 10:56 a.m., Gabia was up 26.18% from the previous day's close at 50,550 won, while KINX was up 29.96% at 36,100 won.

Macquarie previously launched a tender offer in July to acquire control of Gabia and pursue its voluntary delisting. The offer price at the time was 48,000 won per share. Align Partners took issue with the tender offer price and the measures to protect minority shareholders. It sent an open letter to shareholders and said the offer terms were unfair. Ultimately, only about 5.4% of the total shares outstanding were tendered in the offer, which closed on September 17. The tender offer fell through because the minimum number of shares to be acquired was not secured. The share acquisition agreement between Macquarie and Gabia's major shareholders was also terminated.

Align Partners stressed that the agreement was significant because it eliminated unequal treatment between controlling shareholders and ordinary shareholders. It said that although the buyer would first acquire some shares, the remaining ordinary shareholders would also be given the opportunity to sell all their shares at the same price. However, it expressed disappointment that the transaction price still fell short of the companies' intrinsic value.

Lee Chang-hwan, CEO of Align Partners, said, "We highly appreciate Macquarie's decision to improve the price and transaction structure in response to ordinary shareholders' demands and to take into account the interests of shareholders of both Gabia and KINX." He added, "This agreement will serve as a model for wisely resolving the issue of duplicate listings while ensuring ordinary shareholders an equal opportunity to sell their shares during a change of control."

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