Dongwon Group has announced its ambition to significantly strengthen its global food business, aiming to increase its overseas sales percentage from 22% in 2023 to 40% by 2030. For this purpose, the holding company, Dongwon Industries, will fully integrate its affiliate, Dongwon F&B, making it a 100% subsidiary and reorganizing four domestic and international food companies into a single business unit to create synergy.
On the 14th, Dongwon Industries and Dongwon F&B held a board meeting and resolved to sign a comprehensive stock exchange agreement. According to the agreement, Dongwon Industries will issue new common stocks and grant them to Dongwon F&B shareholders at an exchange ratio of 1 (Dongwon Industries) to 0.9150232 (Dongwon F&B), calculated based on the Capital Market Act. Once the stock exchange is completed, Dongwon F&B will become a 100% subsidiary of Dongwon Industries and will be delisted.
Both companies plan to hold a general shareholders’ meeting on June 11 (tentatively) to vote on the stock exchange agenda. Opposing shareholders may exercise their right to demand share purchase, with prices set at 35,024 won for Dongwon Industries and 32,131 won for Dongwon F&B as determined by relevant legislation. The number of newly issued shares by Dongwon Industries will be finalized after the share purchase demand period ends on July 1.
This stock exchange reflects Dongwon Industries’ strategic decision to actively enter the global food market alongside Dongwon F&B to secure a second growth engine and enhance business competitiveness. The need for global expansion arises due to structural changes like declining economic growth rates, domestic market stagnation, and intensified competition within the domestic food market.
After incorporating Dongwon F&B as a 100% subsidiary, Dongwon Industries plans to bundle related affiliates such as Dongwon Home Food, Starkist, and S.C.A SA into a ‘global food business group’ and strategically pursue global business. Through this, the group aims to increase the food business’s overseas sales ratio from 22% in 2024 to 40% by 2030.
Research and Development (R&D) organizations scattered among affiliates will be integrated into a ‘Global R&D Center’ to focus on developing new products competitive in the global market. The R&D budget, which was 0.3% of sales last year, is planned to expand threefold to over 1% by 2030. Utilizing the distribution network of its U.S. subsidiary, Starkist, the company plans to open sales channels in North and Latin America. As part of this, combined products comprising popular items from Dongwon F&B and Starkist will be launched along with new products developed through integrated R&D. Dongwon F&B will collaborate with Senegal-based subsidiaries, S.C.A SA, Capsen, etc., under Dongwon Industries for tuna fishing and canning, using these partnerships as springboards for medium- and long-term expansion into the Middle East and European markets.
The group also intends to pursue large-scale global mergers and acquisitions (M&A). Although Dongwon F&B alone had limitations in engaging in large M&As due to financial constraints, future M&As will be led by Dongwon Industries for rapid growth.
A representative from Dongwon Group stated, “This stock exchange will resolve the ‘dual listing’ (simultaneous listing of a parent and a subsidiary) issue and contribute to enhancing shareholder value,” adding, “Existing Dongwon F&B shareholders will benefit from increased dividends.” As of last year, Dongwon F&B’s dividend was 800 won per share, while Dongwon Industries’ was 1,100 won.