The Financial Services Commission (FSS) of South Korea has requested Dunamu, the operator of Upbit, to correct its disclosure regarding the merger with Naver Financial due to the absence of important details in the report.
Meanwhile, Korea Investment & Securities is considering acquiring a stake in Coinone, following its competitor Mirae Asset Group's acquisition of Korbit.
Why Did the FSS Issue a Correction Order to Dunamu and Naver?
According to the FSS, Dunamu's report submitted on March 30 contained "significant omissions or false statements." The financial regulator specifically pointed out two sections of the report: "Future Company Restructuring Plans" and "Important Matters Related to Other Investment Judgments."
In the original report flagged by the regulator, Dunamu stated that there were no specific decisions regarding company restructuring after the completion of the stock transaction. Dunamu added that future decisions or board resolutions would be disclosed in accordance with relevant regulations.
The company also revealed that Naver would obtain voting rights in Naver Financial through contracts among major shareholders. After the completion of the stock transaction, Naver Financial will continue to operate as a subsidiary of Naver. The share value ratio between Dunamu and Naver Financial was designated as 3.064569:1.
Dunamu explicitly warned investors that the stock transaction might face delays or cancellations due to the need for approval from the Fair Trade Commission, approval for changes in major shareholders of Naver Financial under the Credit Information Act, and changes in the identity of Dunamu's major shareholders under specific financial information laws.
Additionally, Dunamu noted that the ongoing legislative process for the digital asset framework law could impact the progress and outcome of the stock transaction. A report from mid-March indicated that discussions regarding this framework had encountered delays and were not even included in the agenda of a key government meeting on March 19.
Who is Seeking to Acquire a Stake in Coinone?
Korea Investment & Securities is working to persuade financial regulators and politicians to secure a stake in Coinone.
Coinone ranks third in the Korean exchange market, with a double-digit market share, but has reported losses for three consecutive years. Financial authorities are pushing to limit the shareholding ratio of major shareholders in exchanges, so it is expected that CEO Cha Myung-hoon's 53.44% stake will be sold.
Although several domestic companies have expressed interest in the stake, the transaction has not been completed due to significant gaps in price expectations. However, Korea Investment & Securities possesses strong financial capabilities.
Market observers indicate that Korea Investment & Securities needs to acquire about 20% of the shares to enter the transaction without infringing on the CEO's management rights. The acquisition of Korbit by Mirae Asset Consulting for approximately 133 billion KRW (about 93 million USD) is expected to serve as an important reference case.