Rijin Holdings, ensures liquidity through 1.16 million shares of Rijin Electric.

Yijin Holdings is advancing a stock return swap contract based on approximately 1.16 million shares of its subsidiary Yijin Electric, aiming to secure liquidity for future investment funds.

On April 17, Yijin Holdings announced that it plans to enter into a stock return swap contract for about 1.16 million shares of Yijin Electric. A stock return swap is a financial technique where a company enters into an agreement with a financial institution based on its held stock, settling only the gains or losses from stock price movements at maturity. Unlike a complete sale of the held shares, which involves outright disposal, it is a means to balance fundraising and equity management options.

The contract duration is one year starting from May 20, 2026. The benchmark price is set at 86.2k Korean won per share, calculated based on the closing price on April 16, the day before the board meeting. However, the actual number of shares and the benchmark price reflected in the contract are expected to be determined according to the closing price on the final signing date. This approach, which links the final terms to the market price on the signing day, can be viewed as a procedure aimed at reducing price distortion and reflecting market benchmarks.

Yijin Holdings explained that the funds raised through this contract are planned to be used for future growth investments and other purposes. The company stated that although its current financial situation is stable, it is necessary to strategically ensure cash reserves to proactively respond to growth opportunities at the group level in the future. In an environment of ongoing economic uncertainty, having immediate cash reserves to seize large-scale investment opportunities becomes particularly important. This move can be interpreted as a reflection of such judgment.

After the completion of this transaction, Yijin Holdings’ holdings of Yijin Electric shares will decrease to 21,612,921 shares, representing a 45.32% ownership stake of all issued shares. The company explicitly stated that as of April 17, there are no plans to sell additional Yijin Electric shares beyond this matter. It also indicated that the entire process of the stock return swap contract will be conducted in accordance with laws and regulations, and will be transparently disclosed through announcements. Given the ongoing cases where holding companies or major shareholders use their shareholdings to ensure liquidity, such trends are likely to continue as a way to balance fundraising for investments and maintaining control in the future.