Considering such expectations, the private equity firms may have decided to exercise their options to convert Qxpress’ preferred shares, convertible notes and exchangeable bonds to ordinary shares amid the crisis of TMON and WeMakePrice, the sources said.“Financial investors usually add a clause, which allows them to exercise conversion rights in case of an affiliate revival, a serious negligence of CEO or urgent management crisis in preparation for worst-cases when they sign an investment deal,” said an investment banking industry source in Seoul.“The troubles of TMON and WeMakePrice may have caused those investors to exercise the options.”Crescendo bought 60 billion won in Qxpress’ preferred stocks in 2019, while Corstone and Metistone invested 30 billion won and 20 billion won, respectively in the company’s exchangeable bonds in 2021.
Private equity firms, which invested in Qxpress, plan to convert their preferred shares, convertible bonds and exchangeable debts to its ordinary stocks and become the largest shareholders, investment banking industry sources in Seoul said on Thursday.
Seoul-based Crescendo Equity Partners Ltd., Corstone Asia Co., Metistone Equity Partners Co., Cactus Private Equity and Korea Development Bank Private Equity invested a total of some 170 billion won ($123.5 million) in Qxpress’ preferred shares, convertible notes and exchangeable bonds in 2019-2021.
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