A proposed share sale could give JoongAng Ilbo fresh capital during its creditor-led restructuring, with a Daou Kiwoom-led consortium selected to invest in the South Korean newspaper.
JoongAng Ilbo reported that the sale adviser named the group preferred bidder on Oct. 19. In an Oct. 20 securities filing, Daou Technology said a consortium including the company, its affiliate Saramin and CJ had been notified of its selection. The Korea Herald also reported Shinsegae's participation; the Daou filing did not name it.
Asia Business Daily reported an estimated offer of about 500 billion won ($375 million), not a settled price. Under the proposed structure, JoongAng Ilbo would issue new shares to raise money for the company, with proceeds intended for debt repayment and restructuring rather than existing shareholders, JoongAng Ilbo reported.
A creditor-led plan to restructure JoongAng Ilbo's debt was approved in July. Samsung founder Lee Byung-chul established the newspaper in 1965. Among his grandchildren are Lee Jae-hyun, chair of CJ Group, and Chung Yu-kyung, chair of Shinsegae. CJ already holds a 9.24% stake in the publisher through its affiliate CJ OliveNetworks.
Shinsegae said it would pursue ties between its cultural and lifestyle businesses and the paper while respecting its “unique identity and expertise.” A CJ Group official told MoneyToday that editorial independence would be the company's top priority. MediaToday reported that a JoongAng Ilbo union newsletter called for job protections and safeguards for editorial independence from prospective buyers.
JoongAng Ilbo reported that the next stages include a conditional share agreement, meetings of creditors and bondholders, board action and payment. It gave no firm dates.
