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[Alpha Biz= Paul Lee] Hanjin KAL shares tumbled 17% on May 15, closing at KRW 125,000, down KRW 25,600 from the previous session, following two consecutive days of hitting the daily price ceiling.



The sharp decline is attributed to a wave of profit-taking after the stock’s recent rally, which was driven by growing speculation of a potential management dispute.



Earlier, on May 13 and 14, Hanjin KAL surged to the upper limit for two consecutive sessions amid reports that its second-largest shareholder, Hoban Construction, had increased its stake. On May 15, the stock briefly touched KRW 160,500 at market open—its highest in the session—before sharply reversing course.



Meanwhile, Hanjin KAL’s preferred shares (Hanjin KAL Preferred, ticker: HanjinKALU) rose 20.47% to close at KRW 46,500. The stock had earlier hit the upper limit of KRW 51,500, up 29.79%, shortly after the market opened.



Investor attention has been focused on Hoban Construction's increasing stake in Hanjin KAL. On May 12, the company disclosed that its stake had risen from 17.44% (11.65 million shares) to 18.46% (12.32 million shares), acquired via open market purchases for investment purposes.



Affiliates Hoban Hotel & Resort and Hoban Co., Ltd. also expanded their holdings, with Hoban Hotel & Resort acquiring an additional 0.96% stake over the past year, and Hoban Co. purchasing 0.05%. Their respective stakes now stand at 6.81% and 0.15%, bringing the total ownership of Hoban Construction and its affiliates to 18.46%.



Hoban Construction became the second-largest shareholder after acquiring shares from private equity firm KCGI, which previously engaged in a governance battle with Hanjin KAL in 2022. Hoban later acquired an additional 5.85% stake from Pan Ocean in 2023.



As of April 29, Hanjin Group Chairman Cho Won-tae and his affiliated parties held a 30.54% stake in Hanjin KAL, including a 10.58% stake held by the Korea Development Bank (KDB). Excluding KDB, Chairman Cho’s effective stake stands at 19.96%.



Market analysts suggest that Hoban’s stake increase may reignite governance conflict, citing its past attempt in 2015 to acquire Kumho Industrial, the former parent of Asiana Airlines.



Hanjin KAL is the holding company of Hanjin Group, which owns Korean Air and Jin Air.

 

 

 

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