이 기사는 2019년 11월 25일 08:00 thebell 에 표출된 기사입니다.

South Korea's Hyundai Card may defer its planned initial public offering (IPO) once as the leading card issuer has the right to reject the listing.

According to investment banking industry sources, Hyundai Motor Group, which owns majority of Hyundai Card, signed a shareholders' agreement with Hong Kong-based Affinity Equity Partners when selling its 24 percent stake to Affinity Equity Partners-led consortium in February, 2017. Under the terms of the shareholders' agreement, the card company should embark on its IPO process upon Affinity Equity Partners' request. Hyundai Card recently kicked off its IPO process to pick its bookrunners upon financial investors' request.

On the other hand, Hyundai Motor Group has rights to defer Hyundai Card's IPO. The group can reject FIs' request of the IPO once. If financial investors (FIs) repeatedly request the IPO, then the group will be forced to embark on the process.

It is said FIs want the IPO to be done by April or May next year. If the group exercises its right, the listing could be deferred. Market watchers view that the chief executive of the credit card business officially mentioned his preference of the IPO timing based on the terms of the contract.

Ted Chung, chief executive of Hyundai Card, said in an interview with the Financial Times earlier this month that his preference would be for the listing to be deferred until 2021. "We will be IPO-ready before the end of 2020; however, it doesn't mean that we will do it before the end of 2020," said Chung.

According to the Financial Times, Chung wants to defer its listing until the company can boost its value via expansion into south-east Asia and the launch of a new artificial intelligence system.

Chung, however, didn't exercise the veto immediately, but has proceeded with its IPO process of picking its bookrunners. Market watchers see that he wants to gauge the market mood on the listing. He can gauge Hyundai Card's IPO price presented by investment banks and consult with them on future strategies free of charge.

Hyundai Card's six shortlisted securities firms delivered presentations on November 7 and 8. Three local securities firms - NH Investment & Securities, Korea Investment & Securities, Mirae Asset Daewoo - and three overseas banks - JP Morgan, Morgan Stanley, Citi Global Market Securities - participated. Local securities firms valued Hyundai Card's IPO at more than 2.5 trillion won.

Market sees that this amount is not too shabby. When attracting FIs two years ago, the card company was valued at 1.56 trillion won. Its valuation has risen by approximately one trillion won over the two years. This is the level that FIs can exit the company with a considerable amount of profit.

"Hyundai Card may be agonizing over vetoing based on brokerages' presentations. As the valuation suggested by securities firms is higher than expected, the company might not veto," said an investment banking industry source.

"The contents of the shareholders' agreement are unknown," a Hyundai Card official said.

(By reporter Lee Kyung-joo)