South Korea’s Jeil Holdings Corporation, the holding company of the country’s leading poultry processing Harim Group, is mulling to merge with the group’s mid-level holding firm Harim Holdings Co. next year to simplify and improve overall corporate governance.

The plan - along with its aim to become a comprehensive food company - was unveiled at a press conference in Yeouido, Seoul, several weeks before going public on the Kosdaq market on June 30.

Jeil Holdings, which was established in 2011 through a group spin off, manages 74 subsidiaries including six listed companies of Harim Group. The group’s mid-level holding firm Harim Holdings controls NS Shopping Co., Sunjin Co., and other overseas corporations.

The two holding entities could become one over the next year, said one company official.

The merger, along with the group’s corporate succession move, is expected to affect the stock prices of related units once Jeil Holdings goes public on the secondary Kosdaq market.

The desired IPO price has been set at 20,700 won ($18.4)-22,700 won, relatively cheap given its corporate value and dominance in the poultry and livestock industry.

The company will use 460 billion won IPO proceeds to pay back debt raised to buy

Pan Ocean Co. and invest in new businesses.

After going public, Jeil Holdings plans to expand business in overseas markets including Myanmar, Indonesia, and the United States. It wants to branch out to animal feed business and real estate development.

Jeil Holdings is also keen on its new shipping business. Harim Group took over Pan Ocean in 2015 and became one of the country’s 30 largest conglomerates. After the acquisition, sales also increased 58 percent.

Chun Se-ki, director at Jeil Holdings, said that Pan Ocean has a stable number of remaining long-term shipping contracts, and the company plans to establish a shipping network to secure grains and create synergy with other group units.

After the IPO, Jeil Holdings is expected to become one of the top 10 Kosdaq companies valued at about 1.6 trillion won, which is higher than GS Home Shopping Inc. and Paradise Co.

By Chung Woo-sung

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