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South Korea's FSC eases financial burden for M&A buyers

South Korean financial regulator, the Financial Services Commission (FSC), will ease the financial burden on potential corporate buyers when launching tender offers, in a bid to foster active corporate M&As and bring about economic innovation. The new rules will mean that letters of commitment, capital contribution agreements or investment agreements, will be accepted as proof of a buyer's financial capacity, rather than the buyer having to deposit the total amount of money necessary for purchasing targeted stocks. The FSC also plans to streamline conversion procedures for convertible bonds or bonds with warrants, so that they will be electronically processed by the Korea Securities Depository. The regulator is raising an additional KRW1tn (USD750m) worth of corporate structure innovation funds, while the Korean government is supporting the strategic M&As of local companies in the area of state-of-the-art technologies and strategic industries.


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