Sang Young Chung, honorary chairman and father of the current chairman of Korean construction materials manufacturer KCC Corp, yesterday sold a 5% stake in the company, raising W158.3 billion ($137 million).
Chung sold 526,000 shares at W301,000 each, which represented a 1% discount versus yesterday’s close of W304,000, a source said.
The price was fixed at the bottom of the indicative range, which ran from W301,000 to W304,000 per share. The top end of the range was equal to yesterday’s closing price and hence represented no discount at all. The deal was placed with a select group of investors, which is reflected in the very tight discount, another source noted.
There was enough demand to more than cover the deal, and the buyers included both foreign and domestic investors, one source said. They were a combination of long-only and hedge funds, he added.
The order books opened shortly after the end of Korean trading at 2pm Hong Kong time and closed within two hours. The deal came as the sell-off in global stock markets has shown signs of respite after Greece’s election results at the weekend and amid hopes for stimulus measures by major central banks. Korea’s Kospi index ended yesterday’s trading up 0.7%, bringing its gains so far this year to 4.3%.
KCC’s share price gained 2.9% yesterday, taking its rise this year to 6.5%. However, it is down 18% from this year’s peak in March, following the sell-off in global stock markets in recent weeks due to worries about the eurozone crisis.
Through this sale, Chung halved his stake in the company to 5%, from 10%. The sale was said to be due to personal reasons.
J.P. Morgan was the sole bookrunner.
This was the third block trade in Asia this week. On Monday, the second-biggest shareholder in Hong Kong-listed Tsingtao Brewery sold $193 million worth of shares at a 7% discount and, on Tuesday, the controlling shareholder of Taiwan’s Far EasTone Telecommunications sold a small portion of its holdings at a 3.3% discount to raise $170 million.