Hanjin KAL's stock price soared on Nov. 16 on the KOSPI market. Hanjin KAL shares rose 14.75 percent from the previous day to close the day at 28,400 won per share.
Hanjin KAL's stock price skyrocketed due to the market's prediction that the KCGI, Korea's indigenous private equity fund, may have a dispute with Hanjin Group over the managerial rights.
Hanjin KAL announced in an electronic disclosure system of the Financial Supervisory Service on Nov. 15 that Grace Holdings, a limited company, owns 5,322,666 stocks (9.00%) of its shares.
Grace Holdings is a subsidiary of KCGI, a private equity fund operator. With the exception of Hanjin Group family's stake, the KCGI effectively becomes the second largest shareholder of Hanjin KAL.
The market fluctuated because the private equity fund KCGI declared that it would participate in Hanjin KAL`s management. The KCGI has made it clear that it will participate in Hanjin KAL's management with the shares held by Grace Holdings .
Hanjin KAL is a company that is at the core of Hanjin Group's governance structure. Hanjin KAL has a 29.62 percent stake in Korean Air. Hanjin KAL's biggest shareholder is the family members of Chairman Cho Yang-ho who own a combined 26.14 percent stake.
Although KCGI has only 9 percent of its shares, considering the national pension (8.35 percent) and small shareholders (58.38 percent), Cho's family cannot be complacent, market watchers said.