EQT Moves to Delist Douzone Bizon Following Tender Offer

Tender offer price set at 120,000 won per share

Private equity fund manager EQT announced on the 23rd that it plans to proceed with a tender offer to acquire all of the remaining shares of Douzone Bizon, a provider of enterprise resource planning (ERP) and business software solutions for corporations.

EQT had signed a share purchase agreement in November last year to acquire a 37.6% management control stake (excluding treasury shares). After the signing of the share purchase agreement, all government approval procedures, including a business combination review by the Korea Fair Trade Commission and a foreign investment security review by the Ministry of Trade, Industry and Energy, have been completed, allowing the transaction under the share purchase agreement to be closed. At the same time, EQT decided to carry out a tender offer.

EQT said, "Since signing the share purchase agreement, we have carried out the government approval procedures that are mandatorily required under the relevant laws and regulations, while continuously reviewing the future governance structure of Douzone Bizon," adding, "After serious review and consideration, we concluded that delisting the company by making Douzone Bizon a wholly owned subsidiary is in the best interest of the company and its various stakeholders." It continued, "Now that the recent government approval procedures have been completed and it has become legally possible to acquire shares of Douzone Bizon, we have decided to pursue delisting through a tender offer," and explained, "By acquiring all of the remaining shares, we intend to give all minority shareholders the opportunity to sell at the same price as the largest shareholder, thereby allowing them to enjoy the control premium, and to develop the company from a more long-term perspective after delisting."

The tender offer price for the remaining shares has been set at 120,000 won per share, which is identical to the acquisition price of the management control stake, and the tender offer period runs until the 24th. EQT said, "We are offering minority shareholders the same control premium as the largest shareholder, which is also in line with the current administration's policy stance emphasizing the protection of minority shareholders' rights." The tender offer price reflects premiums of 32.6%, 32.4%, 32.3%, and 55.3%, respectively, over the average closing prices (volume-weighted average prices) for the 1-month, 2-month, 3-month, and 12-month periods immediately preceding the tender offer commencement date, as calculated by the Korea Exchange. This represents the highest price since September 2020, and EQT explained that it is expected to generate profits for most investors who participate in the tender offer.

EQT said, "The tender offer price includes a high premium of 25.0% over the closing price on the previous trading day on the Korea Exchange, and since minority shareholders can enjoy the same price premium as the largest shareholder, we expect to be able to secure a substantial stake in Douzone Bizon through this tender offer."

According to the tender offer statement that has been disclosed, the SPC established by EQT may, after the completion of the tender offer, carry out additional procedures permitted under the relevant laws and regulations in order to proceed with the delisting. In this process, additional procedures to acquire more shares, such as a comprehensive share swap with cash consideration, may be implemented to the extent allowed under current law.

Meanwhile, the shares subject to this tender offer amount to approximately 57.7% of the total number of shares that may be issued on a fully diluted basis, excluding the stake that the tender offeror SPC will acquire directly from the largest shareholder and others and excluding Douzone Bizon's treasury shares, and EQT plans to purchase all of the shares tendered in response. Shareholders of Douzone Bizon who wish to participate in the tender offer must visit a branch of NH Investment & Securities, which is handling the tender offer administration, or apply for subscription online (NH Investment & Securities website, HTS, MTS) by March 24, the last day of the tender offer period.