Macquarie Asset Management's public tender offer for Gabia has been called off after failing to secure the minimum required number of shares. Additionally, a separate agreement with the founders to acquire their stake may now be terminated. With plans to restructure the corporate governance through the public tender offer and voluntary delisting derailed, speculation arises that conflicts between the existing management team and activist funds could prolong.
According to data from the Financial Supervisory Service's electronic disclosure system on the 18th, DC K Investment, an investment vehicle established by Macquarie, received bids for a total of 721,413 shares in Gabia's public tender offer. This represents only 22.1% of the minimum target quantity of 3,267,629 shares. Since the minimum threshold was not met, it was decided not to purchase any of the bid shares, resulting in zero actual purchases.
This public tender offer was conducted from July 20 last year through the 17th at a price of 48,000 won per share. The conditions required securing between a minimum of 3,267,629 shares and a maximum of 9,805,505 shares. This falls far short not only of the level needed for delisting but also significantly below the minimum threshold required for the public tender offer itself to be valid.
Uncertainty has also emerged regarding the acquisition of the founders' stake. On July 17, DC K Investment signed a share purchase agreement with three individuals, including Kim Hong-guk, co-CEO of Gabia, to acquire 3,270,248 ordinary shares. This represents approximately 24.4% of all issued shares.
DC K Investment stated that due to the failure of this public tender offer, the preconditions for the aforementioned agreement were not met, and thus the transaction could be terminated. However, it has not been confirmed whether the contract will indeed be rescinded. The 24.4% stake reported in the final report reflects shares that DC K Investment has the right to receive under the agreement, not shares already acquired.
Macquarie had planned to secure its stake through both the acquisition of the founders' shares and the public tender offer, followed by Gabia's voluntary delisting and full subsidiary integration. For the current management team facing pressure from activist funds, this was also a strategy to secure friendly new shareholders. However, with the failure of the public tender offer, it is now uncertain whether these plans will proceed at all.
Major shareholders Miri Capital and E-Line Partners have previously raised concerns over the tender offer price and transaction procedures. E-Line even demanded the convening of an extraordinary general meeting to expand the board size and appoint independent directors. Even after the public tender offer, disagreements among shareholders regarding board composition and strategies to enhance corporate valuation remain unresolved.
Gabia employees have also expressed concern over the control rights conflict. In a joint statement signed by 334 employees last month, they voiced support for the current management team and called for long-term investment and continuity of business operations. Given that Gabia's business requires continuous infrastructure investment in areas such as cloud services and data centers, as well as ongoing research and development, how to define mid-to-long-term investment directions in future governance discussions remains a key challenge.
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