Kolon to Fully Acquire Kolon Mobility Group as Wholly Owned Subsidiary, Set for Delisting

Public Tender Offer at 4,000 Won per Common Share
Investor Protection Measures Implemented

Kolon Corporation will fully acquire its subsidiary, Kolon Mobility Group, making it a wholly owned subsidiary. Kolon Mobility Group is expected to become an unlisted company in the future. Through this restructuring of its business structure, the company aims to strengthen its foundation for future growth by expanding new businesses beyond imported car distribution and fostering its own brands.

On August 7, Kolon Corporation held a board meeting and resolved to conduct a comprehensive stock swap with its subsidiary, Kolon Mobility Group. The exchange ratio is set at 0.0611643 shares of Kolon Corporation’s common stock per one common share of Kolon Mobility Group, and 0.1808249 shares per one preferred share. The stock swap will be carried out through the issuance of new shares by Kolon Corporation. As a result of this decision, Kolon Mobility Group will become an unlisted subsidiary wholly owned by Kolon Corporation. Kolon explained, "By simplifying the governance structure, we can accelerate decision-making and create a more flexible environment for business restructuring."

On January 4, 2023, the Kolon Mobility Group launch ceremony was held at Kolon Tower in Gwacheon, Gyeonggi Province. Kolon

Kolon Mobility Group distributes a number of imported car brands, including BMW, Audi, Volvo, and Lotus. Recently, the company has withdrawn from the JEEP brand dealership business and is adjusting its portfolio. Going forward, the company plans to expand beyond dealer-based operations to grow its own brands and pursue new mobility-based businesses.

Separately from the stock swap, Kolon Corporation will also conduct a public tender offer to protect minority shareholders. The company plans to purchase Kolon Mobility Group’s common shares at 4,000 won per share and preferred shares at 5,950 won per share. This reflects a premium of about 20% over the market price of 3,325 won per common share as of today. The tender offer period will run from August 8 to September 8.

The company also reported improved results for the second quarter. Kolon Mobility Group’s consolidated revenue for the second quarter reached 590.3 billion won, and operating profit was 9.1 billion won, representing increases of 5.6% and 9.2%, respectively, compared to the same period last year. Net profit for the period was 2.4 billion won, up 9.3% year-on-year.

After the public tender offer, Kolon Mobility Group is expected to proceed with delisting procedures, including a shareholders’ meeting. A Kolon Group representative stated, "This stock swap decision will enable us to improve management efficiency and quickly create the conditions needed for business restructuring," adding, "We will continue to make proactive efforts to secure competitiveness."