Kim Dong-seon (김동선), head of future strategy at Hanwha Machinery and Service Holdings (Hanwha M&S), will increase the number of shares in a tender offer by 10.143 million. After announcing on Oct. 12 that he would make a tender offer for 16.06 million common shares, he submitted an amended filing to the Financial Supervisory Service and disclosed it on Wednesday. The tender offer will cover 26.203 million shares including the additional amount, about 31 percent of Hanwha M&S shares.

The offer price will remain 8,000 won per share, and the tender period will also remain unchanged at 22 days from Oct. 12 to Nov. 2. With the increase in shares, about 210 billion won of Kim's personal funds is expected to be used. The 8,000 won price is a 27 percent premium to the about 6,300 won one-month average share price as of the announcement date. Compared with the previous closing price of 6,080 won just before the announcement, it carries a premium of about 32 percent, above the average tender offer premium over the past five years.

The additional tender offer was prompted by expressions of subscription intent by related parties. Kim Dong-kwan (김동관), vice chairman of Hanwha Group, plans to tender 6.762 million shares, or an 8 percent stake. Kim Dong-won (김동원), vice chairman of Hanwha Life, plans to tender 3.381 million shares, or a 4 percent stake. Their combined amount equals 63.2 percent of the initial tender offer size, which could have significantly limited participation by retail minority shareholders. The company said concerns were raised and Kim increased the amount.

Hanwha M&S shares closed at 7,440 won on Oct. 21, up 22.37 percent from 6,080 won just before the tender offer announcement. The difference between the two closing prices is 1,360 won. It posted the biggest gain among KOSPI200 constituents so far this month. The shares are up 30.3 percent from their close of 5,710 won on Sept. 30. Over the same period, the KOSPI200 index fell 17.64 percent.

Hanwha M&S is the holding company for Hanwha Group's Tech and Life businesses. It was established through a corporate split in August and listed on the main stock market in the same month. The Tech business includes Hanwha Vision, Hanwha Semitech, Hanwha Momentum and Hanwha Robotics. The Life business consists of Hanwha Galleria, Hanwha Hotel and Resort, and Ourhome. The tender offer began reflecting concerns over a share price fall and growth prospects raised at its first shareholders' meeting in the first week of last month.

A Hanwha M&S official said Kim's additional purchase both broadly guarantees selling opportunities for ordinary shareholders and further strengthens the acceptance of shareholders' voices and commitment to responsible management that marked the start of the tender offer. The official said the company will also continue to present various measures to raise shareholder value and corporate value.