About two weeks after being named preferred bidder on Oct. 19

Deal expected to close as early as Wednesday

The headquarters of JoongAng Ilbo [Yonhap]
The headquarters of JoongAng Ilbo [Yonhap]

JoongAng Ilbo is set to come under new ownership as a consortium of Daou Kiwooom, CJ Group and Shinsegae wraps up acquisition negotiations with the newspaper's creditors, a move expected to accelerate the media company's financial turnaround.

According to investment banking industry sources Wednesday, the consortium has concluded negotiations on the acquisition of JoongAng Ilbo's management rights and plans to sign a share subscription agreement as early as Wednesday or by Thursday at the latest. Key sticking points have been resolved, and the consortium members are expected to pass board resolutions and make the relevant disclosures.

Once the deal is signed, it will proceed through a series of closing steps — approval by a financial creditors' committee led by lead creditor Hana Bank, a merger filing with the Korea Fair Trade Commission, and a paid-in capital increase and payment of the acquisition price. The process is expected to move quickly, as the creditors' committee is targeting a workout exit before the end of the year.

The transaction will be structured as a third-party allotment of new shares. The consortium will invest about 500 billion won ($373 million) to acquire newly issued shares in JoongAng Ilbo and take management control. Unlike a secondary share sale in which a controlling shareholder transfers existing stock, this structure channels the acquisition funds directly into JoongAng Ilbo. The fresh capital is earmarked for debt repayment and balance-sheet improvement as part of the company's normalization effort.

JoongAng Ilbo entered a creditor-led workout in July. As part of a self-rescue plan to restore financial health, the company pursued a sale of its management rights and tapped Samil PwC as the sale manager to find a new owner. Samil PwC held a final bidding round on Oct. 19 and named the Daou Kiwooom-CJ consortium as the preferred bidder. Shinsegae Group officially joined the consortium the following day, Oct. 20. Six companies participated in the preliminary bidding round: Daou Kiwooom, Orion, Global Saea, OK Financial Group, eBroadcasting and Geumbo Development.

CJ Group and Shinsegae Group did not take part in the preliminary bidding but joined forces with Daou Kiwooom Group in the final round. CJ Group, through its affiliate Olive Networks, holds a 9.24 percent stake in JoongAng Ilbo — making it the third-largest shareholder — and had been considered a leading potential buyer from the early stages of the workout.

With JoongAng Ilbo's ownership change nearing completion, a broader restructuring of Joongang Group is expected to gain momentum. JTBC, which is currently undergoing court receivership proceedings, has selected EY Hanyoung as its sale manager and is expected to issue a sale announcement Monday. Other affiliates, including Phoenix Joongang and SLL Joongang, also have sales processes underway.


park.jiyeong@heraldcorp.com