“Institutional gaps fuel disputes”: C&G Forum calls for stronger South Korean M&A rules

South Korea’s M&A market is facing a structural problem, according to the C&G Forum: unclear rules leave too much room for disputes after transactions begin.

The group, a professional forum focused on corporate governance and management control, held a regular seminar titled “M&A, Transactions That Change a Company’s Fate.” It used the exit strategies of three low-cost coffee franchises and the recent Korea Zinc management-control dispute to examine the market’s current condition and possible institutional fixes.

Kim Hee-kyung, managing partner at Doyeong Law Firm, said M&A remains one of the realistic ways for companies to turn corporate value into cash. She pointed to inheritance taxes that can reach 60 percent when a controlling shareholder premium applies, along with the demanding threshold for a stock-market listing.

Kim emphasized that transaction design matters even when the headline price is the same. “It is important to design a deal structure that controls risk factors such as taxes and contingent liabilities,” she said.

Participants also discussed the prolonged Korea Zinc control dispute. The forum’s central argument was that clearer rules established in advance could reduce wasteful conflict and make transactions more predictable for companies and investors.

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It is important to design a deal structure that controls risk factors such as taxes and contingent liabilities.