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

President Lee Jae Myung emphasized on Friday that hostile takeovers play a crucial role in rectifying flawed corporate governance and alleviating the undervaluation of Korean stocks. He advocated for more lenient and frequent mergers and acquisitions (M&A) to bring about this transformation. Lee also suggested a significant overhaul of the Kosdaq market, advocating for stringent delisting rules to ensure that struggling or inefficient companies exit swiftly.

These proposals were made during a policy meeting on the capital market at the Korea Exchange (KRX).

Lee recognized that the recent decline in stock prices had put his administration's determination and strategies to the test. However, he reaffirmed his unwavering commitment to restoring the capital market's normalcy. According to Lee, this could only be achieved through more accessible and widespread M&A transactions. He stressed that hostile M&A deals are the most effective means to normalize the market.

To incentivize such transactions, Lee called for more concrete measures to promote M&A activity. He believed that a more dynamic M&A landscape would help address the issue of Korean companies being traded at significantly lower values. Additionally, he highlighted the potential of expanding the overall value of the stock market.