The Korea Fund Inc. Announces Rights Offering Resulting in $110 Million in Net Proceeds

Strategic Insights -

The Korea Fund Inc., a closed-end management investment company, has completed its rights offering, which commenced on June 5, 1995, and expired on June 21, 1995. The offering, managed by Scudder, Stevens & Clark Inc., was significantly over-subscribed, with approximately 7.28 million shares, or 98.6% of the 7,386,102 shares available, subscribed for through the primary subscription. The net proceeds from the offering will be approximately $110 million, which will be used to support the Fund's investments in Korean securities. The Korea Fund, established in 1984, was the first US-registered NYSE-listed fund authorized to invest directly in Korean securities.

Key Takeaways:

  • The Korea Fund Inc. completed a rights offering, which resulted in significantly over-subscribed demand, with 98.6% of the available shares subscribed for through the primary subscription.
  • The offering, managed by Scudder, Stevens & Clark Inc., commenced on June 5, 1995, and expired on June 21, 1995, resulting in net proceeds of approximately $110 million.
  • A total of 7,386,102 shares were available in the offering, with approximately 7.28 million shares subscribed for through the primary subscription.
  • The remaining shares available after the primary subscription, approximately 100,000, will be issued at the same subscription price and on a pro rata basis to record date shareholders who elected to subscribe to additional new shares.
  • The Korea Fund invests primarily in equity securities issued by Korean companies and was formed in 1984, making it the first US-registered NYSE-listed fund authorized to invest directly in Korean securities.
  • Daewoo Capital Management Co. Ltd., a subsidiary of Daewoo Securities Co. Ltd., acts as the Korean Adviser to the Fund, while Lehman Brothers Inc. acted as dealer manager for the offering.
  • Georgeson & Co. Inc. served as the Information Agent for the offering, providing further information to investors.

Statistics:

  • 7,386,102: Total shares available in the offering
  • 7,283,000: Shares subscribed for through the primary subscription
  • 98.6%: Percentage of shares subscribed for through the primary subscription
  • $110 million: Net proceeds to the Fund from the offering
  • $15.50: Subscription price of new shares in the primary subscription
  • 100,000: Shares available after the primary subscription to be issued on a pro rata basis to record date shareholders who elected to subscribe to additional new shares

Sources:

  • Business Wire, June 27, 1995
  • The Korea Fund Inc., Formed in 1984, a closed-end management investment company
  • Scudder, Stevens & Clark Inc., Manager of the offering
  • Daewoo Capital Management Co. Ltd., Korean Adviser to the Fund
  • Lehman Brothers Inc., Dealer manager for the offering
  • Georgeson & Co. Inc., Information Agent for the offering