Business Context and Reporting Period
This Form 6-K, filed on May 26, 2023, reports a material event for Woori Financial Group Inc. (Woori Financial Group). The filing details a resolution by the Board of Directors to acquire the remaining shares of its subsidiary, Woori Investment Bank Co., Ltd. (Woori Investment Bank), through a small-scale stock exchange. As of the filing date, Woori Financial Group held a 58.7% ownership stake in Woori Investment Bank. The transaction aims to make Woori Investment Bank a wholly-owned subsidiary to enhance management efficiency and business synergy.
Key Financial Metrics
The filing provides summary financial information for Woori Investment Bank as of March 31, 2023. It does not provide consolidated revenue, profit, or cash flow metrics for Woori Financial Group for the reporting period.
| Metric | Value (KRW) |
|---|---|
| Total Assets (Woori Investment Bank) | 5,800,283,840,149 |
| Total Liabilities (Woori Investment Bank) | 5,137,601,645,813 |
| Total Equity (Woori Investment Bank) | 662,682,194,336 |
| Capital Stock (Woori Investment Bank) | 437,101,703,000 |
| Issued Common Shares (Woori Investment Bank) | 874,203,406 |
Stock Exchange Ratio: 1 share of Woori Financial Group for 0.0624346 shares of Woori Investment Bank.
New Shares to be Issued: 22,541,465 shares of Woori Financial Group common stock.
Material Changes and Transaction Details
The primary material change is the proposed acquisition of Woori Investment Bank's remaining shares. The exchange price was calculated based on the arithmetic mean of weighted average closing share prices over one-month and one-week periods, plus the closing price as of May 25, 2023.
- Woori Financial Group Exchange Price: Won 11,892
- Woori Investment Bank Exchange Price: Won 742
Woori Investment Bank is expected to be de-listed following the transaction. Fractional shares resulting from the exchange ratio will be settled in cash based on the closing share price of Woori Financial Group on the listing date.
Outlook, Risks, and Contingencies
Management Commentary: The transaction is intended to strengthen the competitiveness of subsidiaries and expand the non-banking business portfolio. Woori Financial Group expects to obtain Board approval in lieu of a shareholders' meeting under small-scale stock exchange procedures (Article 360-10 of the Commercial Code). Woori Investment Bank shareholders will vote via an extraordinary shareholders' meeting.
Key Dates:
- Stock Exchange Plan Date: June 1, 2023
- Record Date: June 5, 2023
- Expected Effective Date: August 8, 2023
- Expected Listing of New Shares: August 28, 2023
Risks and Contingencies:
- Termination Triggers: The agreement may be terminated if shareholders owning more than 20% of Woori Financial Group oppose the plan, if a material change occurs in assets or operations, or if legal violations arise.
- Tax Implications: Woori Investment Bank shareholders may face capital gains taxes and a 0.35% securities transaction tax.
- Appraisal Rights: Woori Financial Group shareholders will not be granted appraisal rights due to the small-scale stock exchange procedure.
Investor Verification Checklist
- Verify the final approval status of the stock exchange by the Woori Investment Bank extraordinary shareholders' meeting.
- Confirm the exact number of new shares issued and the final exchange ratio upon the effective date (August 8, 2023).
- Monitor for any material changes in the financial condition of Woori Investment Bank between March 31, 2023, and the effective date that could trigger termination.
- Review the de-listing procedures and timeline for Woori Investment Bank on the KRX KOSPI Market.
- Assess the impact of the 22,541,465 newly issued shares on existing Woori Financial Group shareholders' equity dilution.