Hanwha Builds Comprehensive Financial Group With Securities Capital Raise, Acuon Deal
Hanwha Investment & Securities has officially announced its push to become a comprehensive financial investment business entity, embarking on a large-scale capital raise of up to 900 billion won, or approximately $659.78 million. Hanwha’s financial affiliates are simultaneously pursuing the expansio
Hanwha Investment & Securities is pursuing a comprehensive financial investment business model, aiming to raise up to 900 billion won ($659.78 million) through a capital increase and strategic acquisitions. The company plans to expand its securities arm and acquire a capital company and a savings bank, ultimately creating a financial group encompassing insurance, securities, asset management, and credit finance.
A board meeting on June 30 approved a 500 billion won third-party allotment paid-in capital increase and the issuance of up to 400 billion won in hybrid capital securities. Hanwha Asset Management and Hanwha Life Insurance, the largest shareholders, will each contribute 250 billion won to the capital increase. Upon completion, Hanwha Investment & Securities' equity capital is projected to rise from 2.3 trillion won to 3.2 trillion won, meeting the required 3 trillion won threshold for Comprehensive Financial Investment Business Entity status.
This status would enable the company to engage in complex investment banking functions, such as corporate credit provision and prime brokerage services. The capital raise aims to bolster risk absorption and mitigate capital volatility, while some analysts suggest hybrid capital securities may not be included in the equity capital calculation for qualification purposes, necessitating additional profit accumulation before the firm can fully transition into the category.
Hanwha Life Insurance also announced a definitive agreement with EQT Partners to acquire a 96.06% stake in Acuon Capital, strengthening its non-banking segment and incorporating Acuon Savings Bank as a second-tier subsidiary. The combined total assets of Hanwha Life Insurance and Acuon Capital now total approximately 9.7 trillion won.
The firm's restructuring efforts include expanding the number of newly promoted executives at its financial affiliates by 43%, from 21 to 30, with Vice Chairman Kim Dong-won of Hanwha Life Insurance leading overseas business and mergers and acquisitions as Chief Global Officer.
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