"K-Discount" Calls for Activist Funds

In a recent article by Kim Hak-seong for Yonhap Infomax, SquareWell Partners highlights a growing trend: activist funds are increasingly demanding companies switch their listings to overseas exchanges, citing undervaluation and operational advantages.

This trend has been especially pronounced in the UK, where eight out of ten recent activist campaigns analyzed by SquareWell targeted a shift away from the London Stock Exchange (LSE). The U.S. and Australia were the most popular destinations for these moves, as seen in campaigns involving Glencore and other major firms.

Ali Saribas, Partner at SquareWell Partners, explains, “Relisting can enhance a company’s valuation by expanding liquidity, broadening analyst coverage, and improving governance standards.”

The article also warns of potential implications for Korea. Companies with significant international sales and strong brand recognition may face similar demands unless domestic capital market reforms address undervaluation and governance concerns.

As activist-driven listing changes become a global trend, the risk of reduced market attractiveness looms, potentially triggering a cycle of declining investor interest and further listings abroad.

You can access the full article here.