GS Retail and Korea & Company Rebound in M&A... Edison EV Weakens
[Asia Economy Reporter Song Hwajeong] Recently, as news of corporate mergers and acquisitions (M&A) continues, attention is also focused on how these deals will affect the stock prices of the related companies.
As of 10:10 a.m. on the 2nd, GS Retail was trading at 28,750 KRW, up 250 KRW (0.88%) from the previous day. Although it started weak, it turned upward and continued its rise for the second consecutive day. The previous day, GS Retail rose 0.88%, marking a rebound after six trading days.
Korea & Company also ended the previous day with a 2.31% increase, breaking a six-day consecutive downward trend.
The M&A provided a rebound opportunity for GS Retail and Korea & Company. GS Retail announced that it had signed a contract to acquire approximately 1.3% of Kakao Mobility’s shares the previous day. The acquisition amount is 65 billion KRW. Kakao Mobility is the leading mobility platform service company in Korea, providing various mobility services such as taxis, trains, buses, airlines, and navigation based on Kakao T Taxi. This equity investment is expected to create synergy effects combined with future technologies in various mobility fields such as eco-friendly logistics based on electric vehicles (EV), last-mile delivery, and pet taxis.
Korea & Company disclosed on the 30th of last month that it would acquire a 36.71% stake in Precise Microtechnology, a Canadian micro-electromechanical systems (MEMS) parts design and sales company, for 122.7 billion KRW to diversify its business. Its subsidiary, Hankook Tire & Technology, also participated in this acquisition, securing a 24.48% stake. The market has positively evaluated the entry into growth businesses through M&A. Song Seonjae, a researcher at Hana Financial Investment, said, "This acquisition is positive in that it allows entry into the MEMS business with great growth potential, reduces dependence on the tire industry, and improves return on equity (ROE) by utilizing cash holdings as investment resources."
On the other hand, Edison EV’s stock price has continued to weaken amid acquisition delays. Edison EV, which attracted attention with its acquisition of Ssangyong Motor, has plunged for six consecutive trading days due to the delay. It is showing a decline of over 6% today as well.
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