[단독] 29 times voting rights per share… Coupang Kim Bum-seok holds’super stock’

Coupang announced on the 12th (local time) that it had submitted a report for listing on the New York Stock Exchange through a public announcement by the US Securities and Exchange Commission. The photo is Coupang headquarters in Songpa-gu, Seoul. [연합뉴스]

It was confirmed that Coupang, which is promoting listing on the New York Stock Exchange (NYSE), has granted differential voting rights to Chairman Kim Bum-seok, founder. It is interpreted to mean that major investors recognized Chairman Kim’s management rights. Accordingly, it is expected that the bold investment and employment expansion led by Chairman Kim will continue.

According to the S-1 report filed by Coupang to the US Securities and Exchange Commission (SEC) on the 12th (local time), Coupang granted 29 times’differential voting rights’ per share for Class B shares held by Chairman Kim.

Coupang shares consist of Class A common stock and Class B common stock. Class B is a’super stock’ with 29 times more voting rights per share than Class A, and all are owned by Chairman Kim. Although it is not listed at this time, it has voting rights and can be converted to Class A. In short, even if you have only 1% of the stake, you can exercise 29% of the shareholders’ rights, so you have substantial management rights of the company. It is interpreted that investors who have invested 3.4 billion dollars (about 3.76 trillion won) in Coupang, such as the Vision Fund led by Softbank Chairman Son Jeong-eui, gave him strength.

It also included a clause that if Chairman Kim sold, donated or inherited this stock, it would be invalidated. This means that you only have super stock rights when you exercise management rights. In the case of transfer or donation, it is returned to 1 week (Class A). However, the share ratio of Coupang of Chairman Kim and others has not been disclosed.

Differential voting rights are called multiple voting rights and super voting rights. It is a device that provides more voting rights to stocks owned by founders or CEOs than common stocks to prevent hostile M&A or to support stable company operation. The founders of tech companies such as Google, Airbnb, and Snap received 10 to 20 times the differential voting rights per share.

Coupang’s quarterly performance since 2018. [미국 증권거래위원회 캡처]

As Chairman Kim receives differential voting rights, his influence is expected to be maintained and expanded even after listing. At all times, there was speculation that it would be difficult for him to exercise control of the company as his stake decreased after listing.

“Coupang has been called a synonym for innovation in the e-commerce market,” said Jang-hee Lee, a professor of business administration at Konkuk University. “It also means that investors will remain simple financial investors,” he added. In the case of sale or donation, he said, “It has a symbolic meaning as a founder, so it also contains the so-called’not to eat’.”

Chairman Kim founded Coupang in 2010 and introduced’Rocket Delivery’ for the first time in Korea, delivering the products ordered the next day. Last year, it recorded a sales of 13.25 trillion won and an operating loss of 580 billion won.

Although it has never made a surplus since its founding, it has not stopped expanding its investment in the logistics and delivery sectors. According to S-1, Coupang is operating more than 100 distribution centers in 30 domestic cities as of September last year. There are over 13,000 direct-employed delivery personnel alone.

Coupang said it would employ an additional 50,000 people by 2025 through S-1 documents. Starting this year, it plans to hire an average of 10,000 people a year. As planned, the number of employees will increase to 100,000 by adding 50,000 currently. This means that the number of jobs within the next four years will be similar to that of Samsung Electronics’ 106,200 (March 2020), the largest company in Korea.

It also revealed a plan to distribute Coupang stock to field staff, including delivery staff (Coupang friend). Chairman Kim said through S-1, “I will make an employee at the frontline a stock holder with a fund of 100 billion won.”

Foreign media reported heavily on the news of Coupang’s listing on the NYSE. The Wall Street Journal (WSJ) said on the 13th (local time), “It is expected to be the largest foreign company public offering since Alibaba in 2014.” Reported. It surpassed the $30 billion (about 33.2 trillion won) evaluated by Bloomberg News last month.

Reporter Kwon Yujin [email protected]