Youngone acquires $23 mn worth of Hanjin KAL shares in August

South Korean clothing and footwear distributor Youngone Corp. acquired 30 billion won ($22.8 million) worth of Hanjin KAL Corp. shares in August of this year, according to the Financial Supervisory Service on Tuesday. 

Youngone paid around 62,530 won per share and bought 480,000 shares, which amounts to 0.71% of the total. 

Considering the time and pricing of the shares, it appears Youngone bought the Hanjin KAL shares that Bando Group unloaded in a block deal a few months ago.

The medium-sized builder sold a 15.75% stake in the holding company of the Hanjin Group on Aug. 26 in a block trade to institutional investors for 672 billion won. The group now holds a 0.99% stake in Hanjin KAL. 

The buyers of Bando’s Hanjin KAL stake are considered friendly shareholders to Hanjin Group Chairman Walter Cho, who also goes by his Korean name Cho Won-tae. 

Cho serves as the chairman and CEO of Hanjin Group and Korean Airlines Co., South Korea’s largest airline and flag carrier.

Those who have familial ties to Cho have a combined 18.73% of the Hanjin KAL shares. 

Other friendly shareholders to Cho include the Korea Development Bank, which has a 10.48% stake, Delta Air Lines, Inc. with a 14.78% stake, logistics firm LX Pantos with a 3.83% stake, and Naver Corp. with a 0.99%.

The family and friendly shareholders together boast a 48.82% stake in Hanjin KAL. 

Youngone sells and exports clothes, outdoor sportswear, shoes and bags using Original Equipment Manufacturers (OEMs) located throughout Asia. Its clientele includes Lululemon Athletica Inc., Patagonia Inc. and The North Face. 

Because the operational interests of Youngone and Hanjin KAL are not mutually beneficial, experts are suggesting that the former could be a friendly shareholder of Cho.

Whether Youngone made a financially savvy investment remains to be seen.

The company’s stake in Hanjin KAL is worth around 19.5 billion won, meaning it lost a whopping 10.5 billion won from the acquisition of the shares. 

Write to Ik-Hwan Kim at lovepen@hankyung.com
Jee Abbey Lee edited this article.