[단독] Coupang New York listing secret released… It is not possible in Korea

The secret of Coupang’s direct listing on the New York Stock Exchange was released. This is to guarantee differential voting rights that are not allowed in the Korean stock market. In Korea, the introduction of a differential voting system has been continuously suggested in order to defend management rights, especially in the business world. If’Coupang,’ a national stock that everyone knows about, had been listed in Korea, it could raise a lot of tax revenue through high investment interest. This means that they missed out on IPO with a market cap of 55 trillion won due to institutional inadequacies.

Coupang’s stock exchange report filed by Coupang to the Securities and Exchange Commission (SEC) on the 13th shows that Coupang has two types of common stock. These are Class A and Class B. Class A is the common stock we know. It is a stock with one voting right per share.

Class B is different. They have 29 votes per share. It is so-called’differential voting rights’.

Start-up companies grow by attracting external capital in the process of corporate growth. However, there is a problem that the voting rights of the founders are diluted in this process. The device to solve this problem is the differential voting right. When converting to common stock, Class B has only the same share of ownership as Class A. However, it is overwhelming in terms of voting rights. It means that even if you own only 1% of the stake, you have 29% of the voting rights.

Coupang said, “Class B stocks are only owned by Chairman Kim Bum-seok.” It is a stock that exists only for Chairman Kim. External investors, including SoftBank, were aware of the existence of Class B stocks and invested. It was based on Chairman Kim’s strong trust in his decision-making.

Coupang has eight other types of stocks. These are stocks subject to various conditions of conversion to common stocks from various investors. Class C~Class J are those. Coupang has yet to disclose the share of each investor. This is interpreted because the ownership ratio may change if Class C~Class J stocks are converted to common stocks in the future.

However, when Coupang is listed on the domestic KOSPI or KOSDAQ market, such Class B is just ordinary common stock. Chairman Kim’s voting rights are also sharply reduced to 1 in 29. This is why Coupang chose the US stock market rather than Korea.

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