April 20, 2024

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[THE INVESTOR] Naver founder Lee Hae-jin has reduced his stake in the internet giant ahead of the change of its legal status as chaebol, which will lead to heightened antitrust scrutiny.

According to a regulatory filing on Aug. 23, Lee, who is currently serving as global investment officer, sold 110,000 shares worth 81.8 billion won (US$72.30 million) in a block deal. The selling price, 743,990 won apiece, was about 3 percent discount on the closing price on Aug. 22.

He now owns 4.31 percent stake in the company. 

Lee Hae-jin

The stake sale comes after a failed attempt to sell to institutional investors on Aug. 21 -- they reportedly complained about a lower-than-expected discount rate.

Naver is close to being designated as a “large corporation” with domestic assets exceeding more than 5 trillion won. The company apparently still wants to remain an “ownerless” company unlike other family-owned conglomerates such as Samsung and Hyundai.

The nation’s fair trade law requires a chaebol owner who usually exercises powerful control across all affiliates to be subject to tougher legal and financial scrutiny. The owner is defined as someone who owns more than 30 percent stake in the company, including shares held by family members.

Lee and Naver’s top brass visited last week the Fair Trade Commission to ask for the company, not the founder, to be designated as “owner” of the company. Currently, Naver’s largest shareholder is the National Pension Service with 10.5 percent stake.

Lee stepped down as chairman in October last year to focus on the company’s global expansion, especially in the untapped European market. Since then, he has stayed in Paris where the company set up a startup accelerating campus in June.

Naver said the stake sale was Lee’s own decision. Sources say he could make further investments in overseas markets or use the money to exercise stock options on his Line shares.

By Lee Ji-yoon (jylee@heraldcorp.com)