Korea Stocks Extend Gains After Move to Ban Double Listings

iibwd1ut3phzv62pqlvsf8[9_media_dl_1.png BloombergArticle content(Bloomberg) — South Korean stocks jumped after authorities moved to restrict publicly traded companies from listing certain subsidiaries, curbing a practice long blamed for diluting shareholder value.Sign In or Create an AccountEmail AddressContinueor View more offersArticle contentThe benchmark Kospi surged as much as 5%, extending gains for a third session, after Financial Services Commission Chairman Lee Eog‑weon announced new measures at an investor meeting in Seoul on Wednesday. A more than 5% jump in Kospi 200 futures also triggered a halt in program trading to curb volatility.Article contentWe apologize, but this video has failed to load.Try refreshing your browser, ortap here to see other videos from our team.Article contentArticle content“We will establish solid standards to ensure that the rights and interests of general shareholders are not harmed by the simultaneous listing of parent and subsidiary companies,” Lee said. “We will prohibit duplicate listings in principle through strict screening.” Article contentTop StoriesGet the latest headlines, breaking news and columns.There was an error, please provide a valid email address.Sign UpBy signing up you consent to receive the above newsletter from Postmedia Network Inc.Thanks for signing up!A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againInterested in more newsletters? Browse here.Article content“Double listings” tend to depress holding‑company shares and are widely seen as a structural cause of Korea’s chronic equity undervaluation, known as the “Korea discount.” By banning them, the government aims to lift market value and narrow the gap with global peers.Article contentThe move is also part of President Lee Jae Myung’s broader push to modernize governance and restore confidence in capital markets. Such measures fueled a stock rally that ranked among the world’s best last year, but momentum has stalled since the Iran war, with investors seeking fresh catalysts.Article contentKorean stocks also drew support from Samsung Electronics Co.’ shareholder meeting, in which the chipmaker offered a positive outlook on AI demand. Samsung Electronics and SK Hynix Inc. both jumped more than 7%.Article content“Conglomerates have repeatedly spun off their best divisions and taken them public through IPOs,” said Jung In Yun, chief executive officer at Fibonacci Asset Management Global. Such moves “create dilution and prevent the value of the existing company from rising.”Article contentArticle contentMany chaebols have relied on affiliate IPOs for fundraising. But with new rules restricting affiliate listings, fewer strong business units are likely to be spun off into separate firms, he said. Article contentRead: A $1.7 Trillion Stock Rally Fails to Wipe Out ‘Korea Discount’Article contentShares of holding companies including CJ Corp. and SK Inc. rallied earlier this week after local reports on the proposal. The measure may affect IPO plans for affiliates at major chaebols such as SK, HD Hyundai, and Hanwha Group. Shares of CJ rose as much as 8.8% Wednesday, while SK jumped 3.8%.Article contentLG Energy Solution’s 2022 IPO is often cited as a case in point. LG Chem Ltd. spun off the fast-growing battery unit at the height of the electric-vehicle boom, after which the parent’s shares fell about 9% in the following month before entering a prolonged decline. Article contentThe new rules will push companies to rethink long‑term financing strategies, said Dilin Wu, a research strategist at Pepperstone Group. Article contentFor now, investors appear to be focusing “on the valuation premium that better governance can bring rather than the temporary loss of an IPO window,” Wu said.Article content(Updates stock prices in second paragraph.)Article contentTrending Subscriber only.

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The United States is losing its grip on Canada's steel market Subscriber only Commodities Canadians paying the least at the pump are complaining the most, poll says Personal Finance Posthaste: Why insurance premiums are surging in Canada — especially in these cities News Canadian households hit a high of $18.6 trillion in wealth last year — but geopolitics could lead to growth ‘reversal’ in 2026 Wealth Canadian dollar’s resilience at risk as central bankers meet Economy