[Edaily Marketin Hur Jieun Reporter] K-Beauty company Gudai Global, aiming for a valuation of 10 trillion won, is pushing for a KOSPI listing next year. Gudai Global has expanded its business through aggressive mergers and acquisitions (M&A), partnering with financial investors (FIs) for each major deal. Companies such as Craver, Seorin Company, and Skinfood have been incorporated as subsidiaries of Gudai Global and are contributing to its earnings.

The problem is that the government’s ban on duplicate listings by parent companies has made it difficult for financial investors (FIs) who invested in subsidiaries to exit their investments. If Gudai Global lists on the KOSPI next year, exits via initial public offerings (IPOs) for individual subsidiaries will effectively be blocked. While there are calls for subsidiaries to list on overseas stock markets to separate business areas, experts say it will not be easy to persuade financial authorities.

Preliminary Screening Request in the Second Half… Aiming for KOSPI Listing Next Year

According to the investment banking (IB) industry on the 5th, Gudai Global is proceeding with preparations to file for a preliminary review for a KOSPI listing within the third quarter of this year, with the goal of listing next year. It is reported that the underwriting syndicate is currently stationed at the company’s offices and has entered the final stages of preparing the preliminary review application. Mirae Asset Securities is the lead underwriter for Gudai Global’s listing, with NH Investment & Securities, Citigroup Global Markets Korea, and Morgan Stanley serving as co-lead underwriters.

Leveraging its “Joseon Beauty” brand, Gudai Global has acquired companies such as △ Craver Corporation (Skin1004) △ Seorin Company (Round Lab) △ Skin Food △ Tirtir △ and Laka Cosmetics. During the acquisition process, it adopted a structure in which it shared ownership of the special-purpose acquisition company (SPAC) and subsidiary stakes with multiple financial investors (FIs).

Notable FIs that have invested in major subsidiaries include The Turning Point and Mirae Equity Partners for Craver, and Company K Partners for Seorin Company. These FIs initially participated in the investments with the intention of recouping their capital through individual IPOs of the subsidiaries or the sale of their stakes.

Among them, Craver has completed its “flip”—a restructuring into a local Japanese entity—and is now pursuing a listing on the Tokyo Stock Exchange (TSE). Accordingly, work is also underway to facilitate the exit of The Turning Point and Future Equity Partners from their respective stakes. Craver’s listing is expected to take place after the listing of Gudai Global’s parent company.

Prohibition on Dual Listings… Overseas Listings Also ‘Generally Prohibited’

The issue is that, according to the guidelines announced by the authorities, the parent company’s board of directors is required to fulfill the same obligations even when a subsidiary lists on an overseas stock exchange. This means that even an overseas listing cannot be completely free from the framework of dual listings, which could cause a discount in the parent company’s stock price. It cannot be ruled out that this overseas listing plan could act as an obstacle during the preliminary review and securities registration statement submission stages for Gudai Global’s main entity.

Going forward, Gudai Global is expected to attempt to persuade the authorities by emphasizing the need to separate business areas among subsidiaries and the necessity of targeting local markets. The logic is that, similar to Hyundai Motor’s push for Boston Dynamics’ U.S. listing, a listing aimed at expanding a subsidiary’s unique business scope and establishing a foothold in the global market differs from a simple “spin-off” listing and therefore does not infringe on the parent company’s shareholder value.

The option of Gudai Global directly acquiring stakes in its subsidiaries is also being discussed. As of last year, Gudai Global’s cash and cash equivalents totaled 267.5 billion won, demonstrating robust cash generation capacity sufficient to acquire 100% of some subsidiaries’ shares with funds to spare. Additionally, simplifying the corporate governance structure through measures such as a share swap with financial investors (FIs) who have invested in the subsidiaries is emerging as another option.

An industry insider explained, “Ahead of the preliminary review application in the third quarter, the results of discussions with regulators regarding dual listings and consultations with subsidiary FIs are expected to become clearer,” adding, “Plans to list current subsidiaries on overseas stock exchanges are also likely to change depending on the outcome of these discussions.”