A $388 million new-share purchase would make a four-company consortium the largest shareholder of South Korean publisher JoongAng Ilbo, bringing fresh capital as its parent faced liquidity strain.
JoongAng Ilbo said the group plans to buy 520 billion won ($388 million) in newly issued shares. The publisher said it would receive the full amount and use it to shore up its finances and manage risks tied to its debt.
Daou Technology Inc. is expected to provide 36.5% of the investment, with CJ Corp. contributing 35.7%. Shinsegae Inc. is set to account for 14.1%, and Saramin Co. for 13.7%, JoongAng Ilbo said. If completed, the purchase would make the consortium the publisher’s largest shareholder.
Liquidity difficulties at parent JoongAng Group preceded the newspaper’s entry into a debt workout in July. Hana Bank, its main creditor, and other lenders led the process. JoongAng Ilbo reported that the sale adviser named the consortium preferred bidder on Oct. 19, a step covered in EconoTimes’ earlier report. Asia Business Daily had earlier reported an estimated offer of about 500 billion won ($375 million), rather than a settled price.
The consortium said it planned to retain JoongAng Ilbo’s employees and maintain stable working conditions. JoongAng Ilbo said the consortium had pledged to protect press freedom and editorial independence. JoongAng Ilbo President Park Chang-hee said restoring normal operations and protecting creditor and investor rights were priorities; he also said the new governance structure could improve content competitiveness and management efficiency.
The agreement is scheduled to be signed Thursday, Nov. 5.
