Source: DecenterKorea Original Title: Naver-Dunamu Today Merger···Attention to Stock Exchange Ratio Original Link: https://www.decenter.kr/NewsView/2H0LRICFA0/GZ03

Strategic Merger of Internet Giants and Local Leading Exchanges

The financial subsidiary of a domestic internet giant and the largest local virtual asset exchange operator announced their merger today. After the successful merger, the largest domestic convenient payment operator and the largest virtual asset exchange operator will join forces to create a large digital financial enterprise with a scale of approximately 20 trillion Korean won.

According to financial news, both parties will hold board meetings to discuss the equity exchange proposal. The parent company will also hold a board meeting on the same day to review the merger plan.

Equity exchange ratio becomes the focus

The main focus of this merger is the equity exchange ratio. The market generally estimates the enterprise values of the two companies at 150 trillion and 50 trillion won, respectively. Based on this, the most favorable equity exchange ratio would be 1:3. However, since the existing shareholders of both companies and around 10,000 small shareholders believe the enterprise value is undervalued, the final ratio may be determined between 1:3 and 1:4.

If a share exchange ratio of 1:3 is determined, the original parent company's 69% stake will be diluted to about 17%, while the main shareholders of the operating party will ensure approximately 30% of the shares, becoming the largest shareholder of the merged company.

Regulatory Review and Market Outlook

Mergers require approval from a board resolution and a special resolution of the shareholders' meeting, needing the attendance of more than two-thirds of the shareholders and the consent of more than one-third of the total number of shares issued. In the case where the parent company holds 70% of the shares, it is expected to proceed without hindrance.

However, the consent of other major shareholders (including venture capital funds and securities companies) and approximately 30% of small shareholders is also required. In addition, financial regulatory authorities will focus on reviewing whether the financial risks arising from the combination of convenient payment and virtual assets can be properly controlled; the antitrust department will also examine whether the merger of the two companies could lead to market monopolization.

Vision for Global Financial Infrastructure

After the merger is completed, the domestic digital financial ecosystem will undergo significant changes. The largest local virtual asset exchange will be combined with functions such as stablecoins, payments, remittances, and shopping. Both parties have stated that the goal after the merger is to build a global financial infrastructure to replace PayPal, Stripe, and Visa cards.

The specific blueprint is expected to be announced the day after the board meeting. At that time, the company's senior management will hold a joint press conference to release the business vision after the merger and introduce the roadmap for financial technology and AI business.