Shin & Kim represented Korea’s largest initial public offering (IPO) in the financial market in 2007 in a deal worth KRW 576 billion. The IPO offered new shares in Samsung Card and old shares in Samsung Group affiliate companies in Korea and overseas, and listed the securities on the Korea Stock Exchange. This case also involved direct marketing to foreign investors to allow them to participate in Korean IPO procedures.
Samsung Card’s IPO is significant in several aspects:
First, in May this year, the Financial Supervisory Service (FSS) amended Korea’s IPO/share acquisition system to meet global standards. The Samsung Card IPO was the first transaction to take place under the new system.
Second, both Korean and international investors participated in the Samsung Card domestic IPO. Prior to the new system, international investors received depository receipts under separate foreign IPO procedures.
Third, Samsung Card will enjoy the financial benefits of being listed on the Korean and international stock exchanges at a lower cost than if it had participated in only a domestic IPO. Under the new FSS rules, companies will be able to secure large amounts of capital that would not have been obtainable under a solely domestic or foreign listing.
Finally, principal IPOs in Korea are expected to use the Samsung Card deal as a model basis in the future.