"Toothpaste Recall" Fallout... Taekwang Industrial Cuts Aekyung Industrial Acquisition Price and Delays Closing Date

Adjusted from 470 billion won to 447.5 billion won
"Purchase price and schedule revised by mutual agreement"

Taekwang Industrial has lowered the acquisition price and pushed back the closing date by about a month, reflecting the recent Aekyung Industrial "toothpaste recall" incident.

On the 19th, Taekwang Industrial filed a revised disclosure stating that it has agreed to acquire 8,336,288 shares of Aekyung Industrial (a 31.56% stake) for approximately 223.75 billion won. This is more than 11 billion won lower than the original acquisition price of about 235 billion won.

Under the current structure, Taekwang Industrial will acquire half of the total stake subject to acquisition, and accordingly, the total acquisition price has also been adjusted downward from about 470 billion won to about 447.5 billion won. The scheduled share acquisition date has been changed from February 19 to March 26.

Industry observers analyze that the decisive reason for the change in acquisition terms was the recent incident in which a banned substance was detected in Aekyung Industrial's "2080 toothpaste" product, prompting a voluntary recall. They interpret this as reflecting in the sale price the contingent liability risks arising from recall-related costs and damage to brand image.

When the contract was signed in October last year, Taekwang Industrial paid a deposit of 23.5 billion won, equivalent to 10% of the total acquisition price at the time, and subsequently completed the collateral-setting procedures. Aekyung Industrial, a mid-sized company whose main businesses are household goods and cosmetics, posted sales of about 679.1 billion won and a net profit of about 42.5 billion won last year.

Through this acquisition, Taekwang Industrial plans to expand its portfolio from its existing focus on petrochemicals into K-beauty and consumer goods, thereby securing a new growth engine.

A Taekwang Industrial official explained, "This is an adjustment to the purchase price and the scheduled acquisition date by mutual agreement," adding, "We plan to provide updates on the progress through additional disclosures."

This content was produced with the assistance of AI translation services.