[Click eStock] "M&A Activation Helps Increase Shareholder Value"

Research Alume emphasized on the 7th that policies promoting mergers and acquisitions (M&A) activation would be a more powerful solution to increase shareholder value than the value-up program.

Choi Seonghwan, a researcher at Research Alume, explained, "Korea Zinc's stock price rose 46% in a month due to M&A issues," adding, "Youngpoong Precision, which secured shares of Korea Zinc, also saw its stock price increase by 242% during the same period."

He continued, "Hostile M&A is an effective strategy that re-evaluates corporate value and has an immediate impact on stock prices," adding, "The hostile M&A attempt on Korea Zinc served as an opportunity for the market to reassess the company's potential."

He analyzed, "There are many undervalued companies with strong technology in the domestic stock market," and "The government's value-up program also recognizes that there are many undervalued listed companies with technological capabilities in our stock market." Furthermore, he emphasized, "The value-up program relies on voluntary participation by companies, so it lacks enforcement power," and "there are limitations in inducing short-term stock price increases." He predicted, "If policies to activate M&A were included, corporate value could be reflected more quickly and surely."

Researcher Choi analyzed, "Hostile M&A is relatively active in the United States," and "it is accepted as a natural part of corporate mergers and acquisitions." He added, "The U.S. capital market has relatively fewer legal and institutional restrictions on hostile M&A," and "because it is used as an important means to maximize shareholder value, M&A is actively conducted."

He explained, "Even if the largest shareholder has a high stake, management rights can be challenged through proxy fights," and "there is a need to re-evaluate corporate value through management performance."

He pointed out listed companies that private equity funds might be interested in, including ▲Koryo Steel ▲Sajo Daelim ▲Sindorico ▲Samok S-Form ▲Dongwon Development ▲and Taeyang.