[이코노믹리뷰=김진욱 편집국장] The news of Coupang’s plans to list the New York Stock Exchange (NYSE) makes the political world as well as the economy buzzing. This is why Coupang, which has established itself as the largest online shopping company in Korea, chose the US stock market rather than the domestic stock market. There are also many criticisms of’making money in Korea and opening the investment gateway in the US’.
It is none other than’differential voting rights’ that made Coupang’s US stock market travel with hot potatoes. Earlier, Coupang submitted a stock report to the US Securities and Exchange Commission (SEC) on the 12th (local time) and granted differential voting rights to the founder, Chairman of the Board of Directors Kim Bum-seok. According to this, after listing, Chairman Kim will be able to exercise 58% of voting rights even if he has a 2% stake.
Differential voting rights are the right of a founder or manager to exercise multiple voting rights per share of their shares, and are often used as a means of defense of management rights. This is impossible in Korea following the principle of’one week, one vote’. For this reason, the industry is citing differential voting rights that are favorable to defending management rights as the opportunity for Coupang to choose the US stock market.
However, the opposing camp argues that it is a natural procedure for Coupang, an American company, to list on the US stock market from the outset. That would be the case, the company to be listed is Coupang LLC’s U.S. subsidiary’Coupang LLC’ (now Coupang INC), which owns 100% of Coupang, not a domestic Coupang subsidiary. Most of the board (12 members), including Chairman Kim, are also Americans.
The economic and political circles are tightly tense over Coupang’s’post-Korean stock market’. Particularly, in the political world, a full review of the’multiple voting rights’, which corresponds to the differential decision right, was initiated, saying that it would prevent the’second coup’. Financial Committee Chairman Eun Seong-soo also lowered his attitude, saying, “I will see if there is any reflection or improvement by the Financial Services Commission,” regarding Coupang’s listing in New York.
Coupang is not making an official position on why he chose the US stock market. It is true that the differential voting rights, which emerged as the biggest reason, had some influence. However, for Coupang, which aimed to be listed in terms of corporate growth through investment attraction, the criteria for selecting a listing destination is ultimately the stock market environment (system). It is said that they would have judged that the US stock market environment was more favorable for’entry’ and’follow-up management’ than Korea.
Currently, Coupang needs a huge amount of financing. Until last year, the accumulated deficit alone was 4.5 trillion won, and last year’s operating loss alone was 580 billion won. Although the size of the deficit has been decreasing in recent years, it is highly likely that the US was chosen rather than Korea, where listing screening is difficult for large-scale financing.
In recent years, the addition of regulatory strength targeting large corporations such as the Severe Accident Penalty Act may have also contributed to the destination of the US. In fact, Coupang has experienced several sanctions from financial authorities. In 2019, the company received a warning from the Financial Supervisory Service because it did not meet the standard of equity capital (20% or more) of an electronic financial business operator, and’rocket money’ marketing paid in Coupang Cash was treated as a similar receiving act.
In the contents of Coupang’s listing report, there is a point that revealed the burden of government regulation.
“The Korean government imposes regulations. Management may be held criminally liable.”
For Coupang, Korea’s No. 1 unicorn (corporate value of more than 1 trillion won), the Wall Street Journal (WSJ) and other foreign media determined its corporate value to be 50 billion dollars (about 55.11 trillion won). If it had been listed on the domestic stock market, this value would have been unpredictable. One question comes up while watching Coupang’s “Fork to America” incident. Is Korea a good country for business?
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