[Featured Stock] "Public Buyback to Avoid Margin Call" Socar Plummets

As of 9:30 a.m. on the 17th, Socar's stock price on the KOSPI market is recorded at 15,450 KRW, down 7.76% from the previous day's closing price. This appears to be due to criticism that the tender offer for Socar by the venture capital firm, in which former Socar CEO Jaewoong Lee is the largest shareholder, was a scheme to escape a margin call (additional collateral requirement) on a stock-backed loan.

Earlier, on the 14th, SOQR, the venture capital firm where former CEO Jaewoong Lee is the largest shareholder, announced that it had started a tender offer for Socar from that day. The tender offer price was 17,500 KRW per share, and on the 14th, Socar's stock price closed at 16,750 KRW, up 17.87% from the previous day.

However, after the market closed that day, suspicions began to arise that SOQR started the tender offer to escape a margin call on loans secured by Socar shares.

The venture capital firm SOQR took out loans from Jeju Bank, Pureun Savings Bank, and IBK Capital last year when Socar's stock price was fluctuating between 18,000 and 20,000 KRW, using Socar shares as collateral. However, as Socar's stock price continued to decline, they received margin call demands, and additional collateral was set on the Socar shares. Even on the 13th, the day before the tender offer began, there was an additional stock-backed loan. This led to market suspicions that "they are trying to raise the stock price through a small-scale tender offer of 3 billion KRW to escape the risk of a margin call."

In response, former CEO Lee stated on Facebook, "I regret that Socar has not been able to demonstrate profitability and growth that meet market expectations after going public," and added, "Through the tender offer, we aim to increase shareholder value by allowing investors to recover their invested funds."