Lee calls for easier, more frequent M&As to normalize market

President Lee Jae Myung emphasized on Friday that hostile takeovers are crucial to rectify corporate governance issues and address the undervaluation of Korean stocks, advocating for measures to facilitate easier and more frequent mergers and acquisitions (M&A). He also advocated for a reform of the Kosdaq market, proposing stringent delisting rules to ensure that struggling or underperforming firms exit swiftly.

These remarks emerged during a policy session on the capital market at the Korea Exchange (KRX). Lee recognized that the recent downturn in stock prices had put his administration's determination and policies to the test, but he reaffirmed the administration's unwavering commitment to normalizing the capital market. The president asserted that markets can only be reestablished once M&A transactions are simplified and become more common.

According to Lee, hostile M&A is the most significant mechanism for market normalization. He called for more decisive actions to promote such deals, arguing that a more dynamic M&A sector would aid in resolving the issue of Korean firms trading at significantly undervalued prices and enhance the overall worth of the stock market.