Daou Kiwoom–CJ consortium is acquiring JoongAng Ilbo for KRW 520 billion.

JoongAng Ilbo announced on the 4th that it will sign on the 5th a new share subscription agreement worth KRW 520 billion with the Daou–CJ consortium, which has been selected as the preferred bidder in the merger and acquisition (M&A) process. The investment will be split among Daou Technology (36.5%), Saramin (13.7%), CJ (35.7%), and Shinsegae (14.1%).

This M&A transaction has been carried out in the form of a “third-party allotment paid-in capital increase,” under which the consortium injects new funds into JoongAng Ilbo and subscribes to newly issued shares. In accordance with the resolution of the financial creditors’ council, the consortium’s funds will be used to repay financial claims held by the creditor group. They are also scheduled to be used to repay corporate bonds held by bondholders, following the approval procedures at a bondholders’ meeting slated for the 17th of this month. On the 6th, JoongAng Ilbo plans to consult with the creditors’ council on the acquirer, acquisition method, and repayment ratio.

After JoongAng Ilbo’s liquidity crisis surfaced in June this year due to JTBC’s default, the company entered a corporate financial restructuring (workout) process in July. The creditor group aims to use the new capital to improve JoongAng Ilbo’s financial structure and complete the workout within this year.

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