KT&G headquarters situated in southern Seoul (KT&G)
Singapore-based activist fund Flashlight Capital Companions has provided to amass Korea Ginseng Corp., an affiliate beneath South Korea’s dominant tobacco firm KT&G, on the worth of practically 2 trillion received ($1.47 billion). KT&G known as it a “unilateral” supply.
Korea Ginseng Corp., beneath the wings of KT&G, is the corporate behind the well-recognized crimson ginseng model, JungKwanJang.
“The acquisition supply was unilaterally launched with none dialogue with the corporate,” a press release issued by KT&G on Monday learn. “We’ll look into the letter of intent sufficiently.”
Within the announcement, nonetheless, KT&G additional harassed Korea Ginseng Corp. is a key a part of its plan to nurture future progress drivers. It mentioned it should put in all efforts to attain the objectives set beneath a mid-term marketing strategy launched final 12 months.
The plan, introduced in January 2023, entails bolstering its funding and gross sales in three key areas: next-generation tobacco and nicotine merchandise, sometimes called e-cigarettes, abroad companies associated to vapes and well being complement merchandise provided by Korea Ginseng Corp.
The announcement got here shortly after Flashlight Capital Companions mentioned Monday it has despatched a letter of intent to KT&G, providing to amass a 100-percent stake within the ginseng producer at 1.9 trillion received.
Since 2022, the activist fund has been pressuring KT&G to spin off its ginseng unit, citing low efficiency and undervaluation. KT&G’s board rejected the proposal, seeing the spinoff to be pointless. It additionally voiced issues the separation might result in a lack of synergy for each KT&G and Korea Ginseng Corp.
