[Click eStock] "KT Major Shareholder Change, No Disruption to Ongoing Projects"

On the 3rd, Samsung Securities stated that the projects currently underway at KT will proceed smoothly, regardless of the issue concerning the change of the largest shareholder.

The previous day, KT announced that its largest shareholder had changed from the National Pension Service to Hyundai Motor Group. As the National Pension Service, the former largest shareholder, sold part of its shares, its holding ratio dropped to 7.51%, making Hyundai Motor Group, the second-largest shareholder with 7.89%, the new largest shareholder. Within Hyundai Motor Group, Hyundai Motor Company holds 4.75% and Hyundai Mobis holds 3.14% of KT shares. In September 2022, KT and Hyundai Motor Group became mutual shareholders through a share exchange.

Since its privatization in August 2022 from its predecessor, Korea Telecom Corporation, the National Pension Service had maintained its position as KT’s largest shareholder since August 2003, despite fluctuations in its shareholding ratio. Despite the shareholding change announcement, Hyundai Motor Group does not immediately become KT’s legal largest shareholder. As KT is a telecommunications service provider, any change in the largest shareholder must undergo government review.

According to Articles 10 and 18 of the Telecommunications Business Act, a public interest review by the Ministry of Science and ICT, the competent authority, and approval from the Minister of Science and ICT are required. When becoming the largest shareholder of a telecommunications service provider, the fact must be reported to the Minister of Science and ICT within 30 days from the occurrence, and the review and approval process typically takes about three months. However, the difference in shareholding ratio between Hyundai Motor Group, now the largest shareholder, and the National Pension Service, the second-largest shareholder, is currently only 0.34%, which is not significant. Therefore, if the shareholding ratio changes before the public interest review and approval process by the Ministry of Science and ICT is completed, the procedure for changing the largest shareholder may become unnecessary. Researchers Minha Choi and Younghoon Kang from Samsung Securities predicted that "regardless of the largest shareholder change issue, the projects being internally pursued will proceed without disruption."